Still growing, amid inflation-fighting and great uncertainty
The Dominican economy continues to grow, although at a slower monthly rate. In January-May 2022, the economy grew 5.6%, compared to the same period of 2021. But projections indicate that 2022 growth will end up at 5%, or possibly even less, at closer to 4.3%. For H2 2022, a significant growth slowdown is expected, due to the negative external outlook, and more restrictive domestic monetary policy.
Inflation reached 9.5% in H1 2022, from H1 2021, and the expectation for 2022 is that it will close for the third consecutive year at above the official target of 4± 1%. Inflation won’t return to the target range until 2023. Unemployment is likely to continue to gradually decline, although its trend is subject to great uncertainty over 2023 growth.
The peso is likely to keep appreciating through 2022, although by 2023 it is likely to depreciate, and could exceed its maximum 2020 rate. The current account deficit could increase to -3.9% of GDP in 2022, and then in 2023 return to its 2021 level, yet remain above its 2015-2020 average.
Now read on...
Register to sample a report