Central Bank reduces outlook for growth of the DR economy

Central Bank reduces outlook for growth of the DR economy

The central bank of the Dominican Republic reported today the preliminary results of economic activity as of February 2022. According to the Monthly Indicator of Economic Activity (IMAE) the average expansion of the economy was 6.0% during the first months of the year compared to the same period of 2021, due to year-on-year variations of 6.3% in January and 5.8% in February 2022.

This behavior reflects that during said period the Dominican economy maintained a favorable pace in its performance, which would allow it to face with greater strength and better conditions the international environment that has become even more adverse.

The central bank he also made an adjustment of his perspective of economic growth for 2022 of 5.0%, which implies a reduction when compared to the projections reported in January of this year, when they were between 5.5% and 6.0%.

The governing body cites the Russia-Ukraine military conflict as the main cause of this reduction, “which has caused an increase in the levels of uncertainty and exacerbated the negative supply shock that had been generated as a result of the COVID-19 pandemic.”

The document adds that this affects higher prices of inputs and primary goods for production, including oil, combined with persistent disruptions in supply chains that raised them.

The central bank warns that this projection is maintained only in case the world situation does not continue to deteriorate.

When analyzing the detail by economic activity for the January-February period, the sectors that showed the best performance, on average, in their real added value were: hotels, bars and restaurants (37.1%), other service activities (11.2%), free zone manufacturing (10.2%), trade (9.6%), transportation and storage (9.3%), financial services (7.7%), energy and water (7.5%), communications (6.9%) and health (6.3%), among other.

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