2021 closed with an inflation rate of 5.62%, the highest figure recorded in five years.

The annual variation was higher than market analysts’ estimates. CPI in December was 0.73%.

The general increase in prices in 2021 was 5.62%. This was announced last night by the Dane, which delivered the results of the CPI variation.

According to the statistical entity, in December the figure was 0.73%, which brought the annual inflation to 5.62%, 4 points above the one registered in 2020, which was 1.61%. This figure was almost 30 basis points above the average market expectation of 5.33%.

The sectors with the most significant variations in inflation last year were the food and beverage sector, which recorded a variation of 17.23%, followed by restaurants and hotels (8.83%) and transportation (5.69%).

Two branches that recorded negative inflation in their annual total for 2021 were the information and communication sector, with a variation of -12.10%, followed by the clothing and footwear sector, with -2.60%. The sectors that contributed most to inflation in the first place were food, which contributed 2.73 percentage points to the total variation, followed by lodging, electricity, water, gas and other fuels, which contributed 1.22 points to the variation, and restaurants and hotels, with a contribution of 0.85 percentage points.

Approximately half of the food inflation is being contributed by beef, poultry, potatoes and edible oils, which, according to Oviedo, has to do with an increase in the price of inputs and a rise in the prices of corn and soybeans. It should be noted that the food and alcoholic beverages item drove inflation throughout the year, and was largely responsible for the increase in the consumer price index.

IMPLICATIONS IN 2022

Last year’s inflation figure already has some effects on this year. Thus, several costs that are directly related to inflation will increase in the coming days, as is the case of tolls charged to Invías, rent payments, cadastral appraisals and inflation also works as a cap for the increase in school tuition.

THE HIGHEST FIGURE SINCE INFLATION IN 2017.

Inflation expectations were around 5.33%, so a high result was expected the increase in inflation recorded during 2021 places it as the highest in five years. This because while in 2020 it was relatively low (1.61%), the last time it was above 5% was in 2016. The last years in which there had been high inflations were 2016 (5.75%) and 2015 (6.77%), linked to the international crisis that occurred during these two years.

Source:

https://www.portafolio.co/economia/en-vivo-dane-entrega-resultados-de-la-inflacion-de-diciembre-de-2021-560247