Colombia | Inflation managed to close to single digits in 2023: 9.3%

In December 2023, inflation registered a monthly variation of 0.45% and an annual variation of 9.28%. This result was below the expectations of market analysts, who according to the survey conducted by Banco de la República expected a monthly variation of 0.64% on average.

Key points

• Key points:
• Food inflation continued to decline notably, thanks to a negative monthly variation, which led the figure to decrease by 330 basis points in annual terms, reaching 5%, its lowest level since April 2021.
• Meanwhile, non-food inflation moderated compared to November's data, so that the annual variation went from 10.61% to 10.33% in December, decreasing by nearly 28 basis points. This reduction may have been favored by the pause in the increase of gasoline prices in December.
• Within non-food inflation, the basket of goods continued to decline, falling by 1.34 percentage points compared to November's figure and reaching 7.1% by the end of the year. The services basket, on the other hand, decreased by only 0.07 percentage points, reaching 9.0%; while the administered prices basket showed a slight increase of 0.32 percentage points, closing 2023 at 17.2%.
• BBVA Research estimates that at the beginning of 2024, inflation has some room to continue decreasing due to the strong base effect of 2023; however, the indexation processes, traditional at the beginning of the year, may mitigate such decrease.

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