Rising Prices to Slow Private Consumption, Weakening Colombian Growth In 2022

• Fitch Solutions revised Colombia’s growth forecast to 3.6% in 2022, from 3.8% previously, as the Russian invasion of Ukraine exacerbates pre-existing headwinds to growth. 
• The Colombian economy is a major exporter of crude oil and other commodities, and will likely outperform many of its regional peers in terms of real GDP growth. Furthermore, high commodity prices will help to incentivise domestic production and bolster export growth, partially offsetting a weaker outlook for household consumption and investment in the coming quarters. 
• Elevated inflation and rising interest rates will weaken private consumption growth to 3.5% in 2022, from 14.6% in 2021, and investment growth will slow to 4.2% in 2022, from 9.9% in 2021, as the 2022 presidential election tempers fixed capital formation. 
• While Columbia’s export growth will remain strong due to stronger demand for crude oil and other commodities, exports will slow to 8.3% in 2022, from 14.2% in 2021, due to weakening global growth and external demand. 

(Source: Fitch Solutions)