Slowdown in growth and inflation, with climate vulnerability a worry
The interannual growth of economic activity in September was 4.8%, lower than in August. Despite this slowdown, January-September 2022 accumulated interannual growth was 5.4%, above potential growth. Inflation has managed to maintain a downward trend since May, and y/y CPI growth was 8.2% in October.
The Central Bank continued to adjust the monetary policy rate upwards, for an increase of 25 bp on October 31st, in an attempt to keep both the economy and capital outflows from overheating, given the uncertainty in the world economy and the monetary policy hikes in the United States, the European Union and other countries in the region.
Although the good performance of the Dominican economy is recognized amid the tumultuous context of the last two years, the country’s vulnerability to climate phenomena was once again highlighted. On November 4th, intense rains fell in less than three hours, flooding sectors of Santo Domingo, killing nine people and causing significant damage. Vulnerability is associated with poor infrastructure, inefficient management of storm drainage and the precariousness of marginal human settlements.
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