Consumption in Dominican Republic

Dominican Republic Consumption | Economic News & Forecasts

Dominican Republic - Consumption

Economy plunges in Q2 overall, although contraction eases in May and June

The economy contracted 16.8% in the second quarter according to monthly economic activity (IMAE) data as domestic lockdown measures and the border closure crushed activity (Q1: +0.2% year-on-year). While a breakdown by sector has yet to be made available, Q2’s reading was likely driven by steep falls in the hotels, bars and restaurants; construction; and mining sectors. More positively, economic activity started to recover in May and June, after reaching a low point in April, as containment measures were lifted.

Turning to the second half of the year, despite the reopening of international borders from 1 July, the rebound in the economy could stall after the government reimposed the state of emergency until 10 August due to surging new Covid-19 cases. Health concerns will also temper tourist arrivals.

Regarding the medium-term outlook, Carlos de Sousa, economist at Oxford Economics, comments: “We expect a sharp rebound in 2021, supported by expansionary fiscal and monetary policies, but the economy will remain below its pre-crisis trend as the tourism sector is unlikely to recover its 2019 level until 2023.”

The panel expects the economy to contract 4.2% in 2020, which is down 0.7 percentage points from last month’s estimate, and to expand 5.6% in 2021.

Dominican Republic - Consumption Data

2015   2016   2017   2018   2019  
Consumption (annual variation in %)6.5  5.5  3.9  5.2  4.8  

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Dominican Republic Consumption Chart

Dominican Republic Consumption
Note: Annual variation of total consumption in %.
Source: Dominican Republic Central Bank and FocusEconomics calculations

Dominican Republic Facts

Value Change Date
Exchange Rate52.960.80 %Jan 01

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