2022 closed with a inflation of 13.12 percent, more than double if compared to the 5.62 percent of a year ago and the highest of this century, a similar level has not been registered since March 1999.

The data even exceeded the estimates that the Bank of the Republic (12.3 percent), market analysts (12.64 percent) and the Ministry of Finance (12.2 percent), who trusted that prices would begin to fall in December, but this was not the case.

(Also read: Inflation in Colombia reached a maximum of 13.12% in 2022)

In that month, the cost of living increased 1.26 percent, well above the 0.73 percent that was disturbed in the 2021 period. In addition, it is the highest figure for this month since 1994, when it was 1 .49 percent.

What contributed the most to the soaring annual inflation were the prices of food and non-alcoholic beverages, which rose 27.81 percent. “Without a doubt, the trend that we are observing at the moment corresponds to what has happened since the pandemic and the quarantines began,” said the director of Dane, Piedad Urdinola.

(You may also be interested in: Gasoline hike not only erased relief in electricity rates but tripled it)

The most expensive

The product that marked this data the most was the cost of beef. With the arrival of covid-19, an upward trend began that ended about a year ago. Although it has been going down, it is still 20.21 percent more expensive.

Then there is rice, which began to rise at the end of 2021 and is still doing so. At the end of last year, it had become 54.05 percent more expensive. «The only thing it has done is grow and this trend does not seem to be reversed,» said Urdinola.

The increases registered by products such as arracacha and yam, the onion, cassava, plantain, coffee, milk, eggs and bread.

These higher food prices also made restaurant food more expensive. Again, the pronounced increase began with covid-19 and reached 18.70 percent in 2022.

The pandemic has also caused the prices of cleaning and maintenance products to increase to 37.89 percent more expensive, basically due to the higher costs of soaps and detergents.

Likewise, the purchase of vehicles has been affected since 2019, but since mid-2021 a stronger rise began and its inflation stood at 20.94 percent last year, mainly due to the rise in the price of vehicles. dollar.

Energy prices down

Electricity has been lowering its costs since the last quarter of 2022 as a result of the measures taken by the Government to alleviate the pocket of Colombians. Inflation closed at 22.40 percent, when last October it reached 28.53 percent.
But the data is higher if it is reviewed by cities, since those in the Caribbean region lead, according to the director of Dane, due to the way in which rates are established for this area and higher consumption due to the use of air conditioners.

Above the national average are Sincelejo (37.19 percent), Montería (37 percent), Valledupar (36.84 percent), cartagena (35.88 percent), Riohacha (33.92 percent), Barranquilla (32.08 percent) and Santa Marta (26.98 percent).

However, this relief in the electricity bill was erased by the increases in the gallon of gasoline that deteriorates the National government, which add to the date 1,000 pesos. While energy fell 2 percent from October to December, fuels rose 5.1 percent in the same period.

And for cities…

Only three cities reported inflation below the national average: Medellín (12.75 percent), Manizales (12.61 percent) and Bogotá (12.35 percent).

On the contrary, cucuta It stands out as the city where the cost of living increased the most for Colombians, with 16.34 percent. What had the most impact on this annual variation was the rise in prices for meals outside the home, with an increase of 21.95 percent and a contribution of 1.62 percent.

Other products and services that marked out were the electricitybeef, rice and imputed rent, that is, what the owner expects to receive as rent for the property to cover its maintenance.

What helped contain inflation in this city were the costs of medical supplies and information processing apparatus, though their contributions were very small.

is Bogota –the one with the least variation in all of 2022– what contributed the most was, again, the food consumed in restaurants, which had an increase of 19.01 percent and a contribution of 1.45 percent. The prices of new vehicles also rose due to the rise in the exchange rate, rent, milk and electricity.

The challenges that come

After inflation of 13.12 percent, for the president of the Andi, Bruce Mac’s teacherThe challenges for this year will be in the generation of employment and economic activity, in addition to maintaining the purchasing power of families.

Meanwhile, the CEO of Fedesarrollo, Luis Fernando Mejía, consider that the biggest challenge will be to control inflation, through the correction of macroeconomic imbalances (fiscal and current account).

To achieve this control, Sergio Olarte, chief economist at scotiabank colpatria, He thinks that, quite possibly at its meeting in January, the Banco de la República will again raise its interest rates –perhaps up to a percentage point– in order to discourage consumption.

For his part, BBVA Research We anticipate that the high levels of inflation will continue to be transmitted, especially in the first half of 2023, followed by a moderation of the data that could close the year at close to 8 percent.

What rises with the CPI data

The prices of various services are also updated with the annual inflation figure. For example, the rates for the 30 trips that Invías has a load and the costs of some procedures of the Unique National Traffic Registry (Runt) such as the transfer of ownership, the technical-mechanical review and the issuance or renewal of the driving license.

In addition to crane and yard fees, cadastral appraisalsschool enrollments or notarial and registry services.

Another rise that is coming is that of rents, which could increase up to 13.12 percent. More than 34 percent of the homes in the country are rented.