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Colombia GDP Q4 2021

Colombia: GDP growth eases in Q4; still beats market expectations

Preliminary national accounts data showed that economic growth moderated further in the final quarter of 2021. GDP expanded 10.8% in annual terms, cooling from the previous quarter’s 13.5% increase. The result, which was flattened by a low base effect, still overshot market analysts’ expectations of an 8.5% expansion. Meanwhile, on a calendar- and seasonally-adjusted quarter-on-quarter basis, GDP increased at a softer pace of 4.3% in Q4 (Q3: +6.1% s.a. qoq), suggesting underlying momentum continued to strengthen, albeit at a slower pace.

Domestically, the annual slowdown was broad-based. Private consumption growth softened to 13.7% in Q4 (Q3: +20.5% yoy). The declining unemployment rate in the quarter (Q4: 11.2%; Q3: 12.9%) likely sustained consumption and prevented a larger decline. Government spending growth also moderated, coming in at 11.9% (Q3: +14.9% yoy). Lastly, fixed investment expanded 6.3% in Q4, easing from Q3’s 8.3% increase.

An examination of the external front reflects that it likely contributed to overall growth. Exports of goods and services growth accelerated to 30.5% in the fourth quarter, up from the previous period’s 24.0% increase, pointing to the continued strengthening of foreign demand. Meanwhile, growth in imports of goods and services came in at 31.7% in Q4, easing from Q3’s 39.8% growth. The reading was still robust despite the slowdown and pointed to healthy domestic demand dynamics.

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