Colombia Outlook. December 2024

Summary

The Colombian economy shows signs of recovery driven by domestic demand and private consumption. Investment is expected to rebound from 2025 due to better financial conditions, while the central bank will continue to reduce interest rates amidst a challenging global environment.

Key points

• Key points:
• Global growth reflects divergent trends, with the United States leading the expansion and Europe advancing slowly, while oil prices have decreased due to greater supply.
• Colombia's GDP will be driven by the strengthening of domestic demand, with investment projected to grow 3.9% annually in 2025 and 7.3% in 2026, led by civil works and machinery.
• Inflation will converge towards the target, allowing the Banco de la República to bring its interest rate to 6.5% in 2025 and maintain it at that level for a prolonged period.
• National unemployment will gradually decrease from 10.0% in 2024 to 9.8% in 2026, while the fiscal deficit will remain high, reaching -4.2% of GDP by 2026 despite containment efforts.
• The exchange rate will average 4,339 pesos per dollar in 2025, in a context where the low level of domestic savings increases reliance on foreign direct investment to finance growth.

Geographies

Topics

Tags