Photo credit: Loren Moss
According to statistics released by DANE (National Department of Statistics), Colombia faced a 2014 inflation rate of 3.66%, an increase of 88% over 2013. The government statistics are important because many charges are set and adjusted annually based on the official rate of inflation.
Primary factors affecting Colombia’s higher rate of inflation are attributed to the drop in the global price of Petroleum, Colombia’s primary export, and the somewhat related rise of the dollar against the Colombian peso and other regional currencies. Colombia’s peso has fallen from roughly 1,900 to the dollar to almost 2,400 to the dollar in less than a year, severely pressuring prices on exports. This has led to phenomena such as record auto sales, as consumers fear significant price increases on imported cars and other durable goods.
Colombia’s macroeconomic success relative to other Latin American economies is evident in comparison. Neighboring Venezuela’s rate is over 63% annually, and Argentina’s rate exceeds 41%. Somewhat more stable Brasil faces a rate of 6.4%.