Inflation in Colombia closed 2022 at 13.12%: a new record outside expectations

Inflation in Colombia closed 2022 at historical levels of 13.12%, a rise of 7.5 percentage points (pps) compared to what was reported in 2021 (5.62%), according to Dane. Said figure was well above what was expected by the market and had not been seen since March 1999 (13.51%).

It is worth mentioning that the market expected on average that inflation would close 2022 at 12.62% per year, while the projected monthly rate was 0.82% on average, according to a Citi survey that consulted 25 market experts.

According to the Dane data, and as expected by the market, food contributed the most to annual price growth in December 2022 with 4.88 points. In second and third position were public services (2.25 points) and restaurants and hotels (1.84 points).

“In December 2022, the highest price increases (in food) were registered in the subclasses arracacha, yams and other tubers (109.84%), onion (106.81%) and cassava for home consumption (88.08%)”, said the Dane.

According to Piedad Urdinola, director of Dane, the effects of a “so prolonged” winter throughout the year impacted foods such as milk and beef because it generated problems in the supply of animal feed and infections. In addition, it affected other crops, such as beans and peas.

In line with the above, the statistical entity reported that there were three items that grew more than the annual inflation of December 2022 (13.12%): food and non-alcoholic beverages (27.81%), restaurants and hotels (18,54%) and household items (18.25%).

Cúcuta (16.34%), Sincelejo (15.83%) and Valledupar (15.53%) were the three cities with the highest inflation in Colombia during 2022. Meals in table service and self-service establishments, electricity and beef Res and derivatives were the items that contributed the most to the inflationary upturn in Cúcuta.

In monthly terms, inflation in Colombia closed 2022 at 1.26%, which meant an increase of 0.53 percentage points compared to what was reported in December 2021 (0.73%). Food, restaurants and transportation were the items that most impacted monthly inflation in the country last year.

By social class, the Dane reported that the inflation of the population in poverty ended 2022 at 14.92%, that of the vulnerable was 14.80%, while that of the middle and upper class was 13.28% and 11.52%.

With information from Bloomberg