The rise in prices in March led to annual inflation will close the first quarter of 2022 at 8.53%. The Consumer Price Index (CPI) registered an increase of 7.02 percentage points, above the figure for the same month last year, since in March 2021 the annual variation was 1.51%.
(Annual inflation in Colombia reached 8.53% in March 2022).
This is the highest peak in annual inflation since July 2016, when it was 8.97%.
As revealed by the National Administrative Department of Statistics (Dane), the monthly rise in prices experienced by consumers in March was 1.0%, while in March 2021 the monthly CPI registered an increase of 0.51%.
According to the director of Dane, Juan Daniel Oviedo, the monthly data for March “corresponds to almost double what we had seen in the month of March 2021”and highlighted that “The average monthly inflation of the CPI in the months of March is historically 0.53%, and in food 1.02%”.
According to the report delivered by the entity, the food sector was the one that contributed the most to the monthly variation of the CPI, with 0.52 percentage points, where rice contributed 6 basis points (0.6 percentage points), and fruits the same value.
(Market expects inflation in March to approach 8.45%).
This item also registered an increase of 2.84%, the highest of all sectors. This group was followed by goods and services for the home, which registered an increase of 1.83%, especially due to the pressure of cleaning products such as bar and powder soap, among other products.
In third place, restaurants and hotels registered a monthly variation of 1.42%.
As for the annual figures, food also continues to drive inflation, with a contribution of 4.07 percentage points. In March its annual inflation was 25.37%.
A general level, The sectors that register the highest annual variations are restaurants and hotels (13.55%) and goods and services for the home, a group that includes cleaning products, which have risen 10.53% compared to March last year.
“We are seeing inflation that is 1.89 times the reference historical average for the month of March”also highlighted the director of the Dane.
Additionally, Dane also delivered the report for the year to date (January-March), and as revealed, in the first quarter of the year prices rose 4.36%, almost three times the inflation registered in the first three months of 2021.
FORECASTS FOR 2022
The rise in inflation in recent months has led the different market players to revise their forecasts for the end of the year upwards.
The latest ‘Survey of expectations’ by the Bank of the Republic placed the figure for 2022 at 6.46%, while in the Fedesarrollo Financial Opinion Survey (EOF) For March, analysts predicted that at the end of the year inflation will close at 6.40%, showing an increase in their prediction compared to that of February (5.05%).
One of the most recent revisions was made by Corficolombiana, and it anticipates that inflation will close 2022 at 8.4% and that it will remain between 8.5% and 8.9% during the second half of the year.
“Inflation would remain at high levels as a result of the shock of supplies generated by the conflict. In our new baseline scenario, inflation is going to close the year at a much higher level than we anticipated last year and marginally higher than what the market has been anticipating.”indicated José Ignacio López, head of economic research at Corficolombiana.
(Inflation, the headache for the Colombian economy).
Likewise, Banco de Bogotá also revised its projections in the last week, and according to Camilo Pérez, head of the bank’s economic research department, inflation would close the year at 6.4%.
From Banco Itaú, the projection was also recently updated, above what was expected last year. “For 2022 we now expect inflation of 6.5%, 100 basis points above our previous forecast of 5.6% in 2021”, stated Carolina Monzón, manager of Economic Research at Itaú Colombia.
Grupo Bancolombia, for its part, recently reviewed the data for the first two months, and assured that “Annual inflation of more than 7% would be foreseeable in December 2022”, higher than the preliminary balance that the bank had, by 6.2%. A little lower is Citi’s projection, which is at 5.7% for the end of 2022.
Among the multilateral organizations, The International Monetary Fund (IMF) delivered last week the conclusions of its annual visit to Colombia, and ratified an expectation of 6.9% by the end of the period.
For JP Morgan, the forecast is at 6% for the end of the year, and was also revised in March.
LAURA LUCIA BECERRA ELEJALDE
