Dominican Republic

Dominican Republic Economic Forecast

Dominican Republic Economic Outlook

The economy gained notable steam in the third quarter: GDP growth nearly tripled to 2.6% year on year in Q3 from Q2’s 1.0% annual increase. Q3’s reading was the strongest since Q4 2022. Consequently, GDP rose 1.7% in January-September. Looking at monthly data, Q3’s upturn was largely due to activity growth in September accelerating to a nine-month high likely on strong household consumption. Interest rates were cut, inflation averaged the lowest since Q2 2020 in Q3, and annual remittances growth picked up to the strongest since Q4 2021 in the quarter. Meanwhile, tourist arrivals rose 10.2% year on year in Q3, virtually unchanged from Q2, despite the sector having seemingly completed its post-Covid-19 recovery. Further interest rate cuts in October and relatively muted price pressures should lead to stronger GDP growth in Q4.

Dominican Republic Inflation

In September, inflation inched up to 4.4% (August: 4.3%) on stronger price increases for food. In 2024, inflation will slow from 2023 and should average around the midpoint of the Central Bank’s 3.0-5.0% throughout the year due to the lagged effects of past interest rate hikes. Stronger-than-anticipated activity is an upside risk.

This chart displays Economic Growth (GDP, annual variation in %) for Dominican Republic from 2013 to 2022.

Dominican Republic Economic Data

2018 2019 2020 2021 2022
Population (million) 10.3 10.4 10.4 10.5 10.6
GDP (USD bn) 85.6 88.8 78.8 94.5 114.0
GDP per capita (USD) 8,335 8,574 7,545 8,966 10,719
GDP (DOP bn) 4,236 4,562 4,457 5,393 6,261
Economic Growth (Nominal GDP, ann. var. %) 11.4 7.7 -2.3 21.0 16.1
Economic Growth (GDP, ann. var. %) 7.0 5.1 -6.7 12.3 4.9
Total Consumption (ann. var. %) 5.2 4.8 -2.4 5.6 5.0
Private Consumption (ann. var. %) 5.7 4.6 -3.4 6.6 5.1
Government Consumption (ann. var. %) 2.8 6.3 4.9 0.1 3.9
Fixed Investment (ann. var. %) 13.3 8.1 -12.1 22.1 4.0
Exports (G&S, ann. var. %) 6.1 1.5 -30.3 36.2 13.7
Imports (G&S, ann. var. %) 8.5 5.8 -14.5 25.7 14.4
Unemployment (% of active population, aop) 5.7 6.2 5.8 7.4 5.3
Fiscal Balance (% of GDP) -2.3 -2.3 -7.6 -2.5 -2.7
Public Debt (% of GDP) 50.5 53.6 71.5 63.2 59.5
Money (ann. var. of M2 %) 4.5 10.4 16.0 15.3 7.0
Inflation (CPI, ann. var. %, eop) 1.2 3.7 5.6 8.5 7.8
Inflation (CPI, ann. var. %, aop) 3.6 1.8 3.8 8.2 8.8
Key Policy Rate (%, eop) 5.50 4.50 3.00 3.50 8.50
Exchange Rate (DOP per USD, eop) 50.46 53.25 58.12 57.29 56.23
Exchange Rate (DOP per USD, aop) 49.50 51.37 56.53 57.07 54.94
Current Account Balance (USD bn) -1.3 -1.2 -1.3 -2.7 -6.3
Current Account Balance (% of GDP) -1.5 -1.3 -1.7 -2.8 -5.6
Merchandise Trade Balance (USD bn) -9.6 -9.1 -6.8 -11.7 -17.0
Merchandise Exports (USD bn) 10.6 11.2 10.3 12.5 13.8
Merchandise Imports (USD bn) 20.2 20.3 17.1 24.1 30.7
Merchandise Exports (ann. var. %) 5.0 5.2 -8.0 21.0 10.6
Merchandise Imports (ann. var. %) 13.9 0.3 -15.6 41.1 27.3
Foreign Direct Investment (USD bn) 2.5 3.0 2.6 3.2 4.0
International Reserves (USD bn) 7.6 8.8 10.8 13.0 14.4
International Reserves (months of imports) 4.5 5.2 7.5 6.5 5.6
External Debt (USD bn) 31.9 34.2 40.3 43.7 -
External Debt (% of GDP) 37.2 38.5 51.1 46.3 -

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