attractive landscape in Colombia

Colombia PMI January 2022

Colombia: Manufacturing PMI moderates further in January; conditions continue to improve

The seasonally-adjusted Manufacturing Purchasing Managers’ Index (PMI)—produced by IHS Markit and Davivienda—dropped to 52.6 in January from 53.1 in December, marking a seven-month low. Despite the fall, the index remained above the 50-threshold, signaling a continued, albeit softer, improvement in business conditions compared to the prior month.

January’s moderation came amid new orders growth moderating to a seven-month low, largely due to high price pressures and muted demand for certain goods. Additionally, output grew only marginally in January, with growth softening to the slowest rate since July 2021. Production was held back by raw material and staff shortages. Turning to prices, input inflation continued to rise amid shipping issues, currency weakness and a scarcity of raw materials. Firms passed on the burden to clients, leading to higher output prices. More positively, producers reported some easing of supply chain bottlenecks. Lastly, employment levels rose solidly in January, supported by firms’ optimism with regard to output expectations in the coming 12-month period.

Andrés Langebaek, chief economist at Davivienda, noted:

“The PMI data for January is in line with what we expect for 2022: a slowdown in economic growth both in the world and in Colombia. As a result of a more rapid normalisation of global interest rates and the moderation of fiscal stimuli in most parts of the world, global economic growth is expected to moderate. In the case of Colombia, the most important concern for this year has to do with investment behaviour. Expectations of higher interest rates, a higher country risk premium and currency devaluation are not supportive of a good investment climate. We have to add that this is an electoral year in which very different economic policy proposals are debated, which generates an increase in uncertainty and the postponement of investment decisions.”

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest X Download Fullscreen