Literatura científica selecionada sobre o tema "Output persistence"

The paper analyses the degree of output persistence in GDP in order to empirically discriminate between the Solow growth model, the perfect competition endogenous growth model, the imperfect competition endogenous growth model, and the subcase of a multiple equilibria model of endogenous growth for the case of Austria. We find that a temporary shock in the growth rate of output induces a permanent and larger effect on the level of GDP. This leads us to refute the Solow growth model and the perfect competition model. We find strong empirical support for the imperfect competition growth model, but cannot fully rule out the possibility of multiple equilibria growth rates.
Series: Department of Economics Working Paper Series

Identifying business cycle stylised facts is essential as these often form the basis for the construction and validation of theoretical business cycle models. Furthermore, understanding the cyclical patterns in economic activity, and their causes, is important to the decisions of both policymakers and market participants. This is of particular concern in developing countries where, in the absence of full risk sharing mechanisms, the economic and social costs of swings in the business cycle are very high. Previous analyses of developing country stylised facts have tended to feature only small samples, for example the seminal paper by Agénor et al. (2000) considers just twelve middle-income economies. Consequently, the results are subjective and dependent on the chosen countries. Motivated by the importance of these business cycle statistics and the lack of consistency amongst existing research, this thesis makes an important contribution to the literature by extending and generalising the developing country stylised facts; examining both classical and growth cycles for a sample of thirty-two developing countries. One significant finding that emerges is the persistence of output fluctuations in developing countries and the strong positive relationship between the magnitude of this persistence and the level of economic development. The observation of procyclical real wages and significant price persistence indicates the suitability of a New Keynesian dynamic general equilibrium model with sticky prices, to explore this relationship; thus, the vertical production chain model of Huang and Liu (2001) was implemented. This model lends itself to such an analysis, as by altering the number of production stages (N) it is possible to represent economies at different levels of development. There was found to be a strong significant positive relationship between the magnitude of output persistence generated by the model and economic development. However, a very significant finding of this analysis is that the model overestimates output persistence in high inflation countries and underestimates output persistence in low inflation countries. This has important implications not only for this model, but also for any economist attempting to construct a business cycle model capable of replicating the observed patterns of output persistence.

Human ageing is associated with a progressive decline in the function of the immune system, commonly referred as immunosenescence. This is characterized by the shrinkage of the naïve T-cell repertoire and a concomitant accumulation of highly differentiated effector-memory cells and dysfunctional senescent T-cells. These systemic immune alterations have clinical implications and have been associated with increased morbidity and mortality in the elderly. However chronological ageing may not be the only factor influencing immunosenescence and certain lifestyle factors may moderate or potentiate the rate at which immune alterations occur. The studies comprised within this thesis investigated the effects of lifestyle factors such as physical activity or obesity, along with latent viral infections on the proportions of highly differentiated and senescent T-cells. Data were gathered from individuals of various age, physical activity, body composition and latent viral infection status to assess the effects of a wide range of lifestyle factors on T-cell proportions. The different levels of T-cell differentiation were assessed by four-colour flow cytometry using monoclonal antibodies specific to cell surface markers associated with T-cell phenotypes. The role played by leptin on T-cell activation was assessed by in vitro stimulation assays followed by cell surface phenotype and gene expression analysis. The effects of acute bouts of exercise on T-cells subsets were characterized using a submaximal cycling protocol. Aerobic fitness was associated with lower proportions of senescent and higher proportions of naïve T-cells, particularly within the CD8+ T-cell compartment in healthy adult men. The beneficial impact of aerobic fitness, and consequently of regular physical activity, on the ageing immune system was independent of age, latent viral infection status and body composition. Furthermore, the moderating effect of higher estimated VO2max on the proportions of senescent T-cells suggested that a transition from low physical activity, characterized as having an estimated VO2max below average, to regular physical activity, characterized as having a VO2max above average, could prevent the age-associated accumulation of senescent T-cells during decades. Obesity and excess serum leptin in adolescents were shown to be associated with changes in T-cell subsets associated with immunosenescence, such as reduced proportions of naïve and early T-cell and increased proportions of effector-memory and senescent T-cells. In addition, high physiological concentrations of leptin enhanced the mitogen-induced T-cell activation in vitro suggesting a potential role in the accumulation of senescent T-cells observed in obese individuals. Latent CMV infection was also associated with similar reductions in naïve T-cell proportions and increased proportions of highly differentiated and senescent T-cells in young adults. Although CMV infection appeared to be associated with an amplified exercise-induced preferential mobilization of highly differentiated and senescent T-cells in blood, those cells may not have been specific for CMV. It is concluded from this work, therefore, that chronological ageing is not the only factor associated with the accumulation of senescent T-cells in the elderly. By preventing obesity, and by potentially inducing senescent T-cells frequent mobilization and subsequent deletion via apoptosis, regular physical activity may prevent the accumulation of highly differentiated and senescent T-cells in the elderly, and consequently reduce morbidity and mortality in later life.

Ce mémoire porte sur l'étude d'un système de gestion d'énergie électrique dans un système multi-sources soumis à des perturbations exogènes. L'application visée est l'alimentation d'une propulsion hybride diesel/électrique équipée d'un système d'absorption des pulsations de couple. Les perturbations exogènes considérées peuvent être transitoires ou persistantes. Une perturbation transitoire correspond à une variation rapide du couple de charge, due par exemple à une accélération ou une décélération du véhicule. Une perturbation persistante provient du système de compensation des pulsations de couple générées par le moteur thermique. Le premier objectif du contrôle est de maintenir constante la tension du bus continu. Le deuxième objectif est d'absorber dans un système de stockage rapide constitué de super condensateur ces perturbations qui peuvent à terme provoquer une usure prématurée de la batterie. Le troisième objectif est de compenser l'auto-décharge dans le super condensateur en maintenant constante sa tension nominale. Les deux sources (batterie et super condensateur) sont reliées au bus continu par l'intermédiaire de deux convertisseurs boost DC/DC. La commande consiste à piloter les rapports cycliques de chaque convertisseur. C'est un système non linéaire où la commande est multiplicative de l'état. L'approche classique consistant à résoudre les équations Francis-Byrnes-Isidori ne s'applique pas directement dans ce cas où la sortie et la matrice d'interconnection dépendent de la commande. De plus, si cette approche est bien adaptée au rejet de perturbations persistantes, elle montre ces limites pour le rejet de perturbations non persistantes combiné à des objectifs de régulation. Notre approche a consisté à écrire le système sous un formalisme Port-Controlled Hamiltonian et à s'affranchir de la contrainte de la dépendance de la matrice d'interconnection avec la commande en utilisant la théorie des perturbations singulières. La commande du système dégénéré peut ensuite être calculée par une approche passive. Les performances de cette commande ont été testées en simulation et à l'aide d'un banc d'essai expérimental. Les résultats montrent l'efficacité du système d'absorption des différents types de perturbation tout en respectant les deux objectifs de régulation
This thesis presents the research of energy management in a battery/ultracapacitor hybrid energy storage system with exogenous disturbance in hybrid electric vehicular application. Transient and harmonic persistent disturbances are the two kinds of disturbances considered in this thesis. The former is due to the transient load power demand during acceleration and deceleration, and the latter is introduced from the process of the internal combustion engine torque ripples compensation. Our control objective is to absorb the disturbances causing battery wear via the ultracapacitor, and meanwhile, to maintain a constant DC voltage and to compensate the self-discharge in the ultracapacitor to maintain it operating at the nominal state of charge. The object system is nonlinear due to the multiplicative relation between the input and the state. The traditional approach to solve Francis-Byrnes-Isidori equations cannot be directly applied in this case since the interconnect matrix depends on the control input. Besides, even if this approach is well suited to the rejection of persistent disturbances, it shows the limits for the case of non-persistent disturbances which is also our object. Our contributed control method is realized through a cascade control structure based on the singular perturbation theory. The ultracapacitor current with the fastest motion rate is controlled in the inner fast loop through which we impose the desired dynamic to the system. The reduced system controlled in the outer slow loop is a Hamiltonian system and the controller is designed via interconnection and damping assignment. Simulations and experiments have been carried out to evaluate the control performance. A contrast of the system responses with and without the control algorithm shows that, with the control algorithm, the ultracapacitor effectively absorbs the disturbances; and verifies the effectiveness of the control algorithm

The real convergence hypothesis has spurred a myriad of empirical tests and approaches in the economic literature. This Work Project intends to test for real output and growth convergence in all N(N-1)/2 possible pairs of output and output growth gaps of 14 Eurozone countries. This paper follows a time-series approach, as it tests for the presence of unit roots and persistence changes in the above mentioned pairs of output gaps, as well as for the existence of growth convergence with autoregressive models. Overall, significantly greater evidence has been found to support growth convergence rather than output convergence in our sample.

Sepsis is triggered by an infection, and treatment of sepsis requires timely identification of the patient, and rapid treatment with antibiotics, source control, and fluids. The site of infection, patient’s phenotype, and location of the patient will help drive decisions about initial antibiotic therapy. Patients with sepsis should be treated to ensure adequate cardiac output and organ perfusion, which usually requires infusion of intravenous fluids. In addition to haemodynamic and fluid support, some patients require infection source control. Many sepsis patients require additional supportive therapy with vasoactive agents, mechanical ventilation, renal replacement therapy, and nutritional therapy.. When using these supportive therapies, the clinician should attempt to minimize the complications of the therapies, including withdrawal of therapies that are no longer necessary.. Patients who do not respond to initial therapy should be evaluated for resistant organisms, persistent sources, or alternate diagnoses.

This chapter shows a way to, using simulation analysis, assess the performance of some of the most popular unit root and change in persistence tests. The authors do this by means of Monte Carlo simulations. The findings suggest that these tests show a lower than expected performance when dealing with some of the processes commonly believed to be found in the economic and financial data. The output signals that extreme care should be taken when trying to support a theory using real data. As the results show, a blind practitioner could get misleading implications almost surely. As an empirical exercise, the authors show that the considered test finds evidence of a unit root process in the US house price index. Nonetheless, as the simulation analysis shows, extreme caution should be taken when analyzing these results.

John Hurst made an important pioneering contribution in three separate but interrelated fields: medieval archaeology, post-medieval archaeology, and ceramic studies. Before his lifetime's devotion to these three disciplines, they had not been taken seriously in Britain or Europe, either academically or professionally. Medieval archaeology was still the study of major buildings seen through the records of historians and anti-quarians, and of portable antiquities divorced from their context. Post-medieval archaeology was principally the study of industrial relics. Ceramic studies in the post-Roman period was the preserve of art collectors, anxious to understand the output of major factories and firms, though a few people collected medieval pottery as examples of folk art. It is a measure of Hurst's perceptiveness and persistence that all these three fields are now studied more widely and practised seriously.

Many systems must operate in the presence of delays both internal to the system and in its inputs and outputs. In this paper we present a robustness result for mildly nonlinear systems. We use this result to show that for small unknown input delays, a simple adaptive controller can produce output regulation to a neighborhood with radius dependent upon the size of the delay. This regulation occurs in the presence of persistent disturbances and the convergence is exponential. We conclude with an example to illustrate the behavior of this adaptive control law.

Many systems must operate in the presence of delays both internal to the system and in its inputs and outputs. In this paper we present a robustness result for mildly nonlinear systems. We use this result to show that, for small unknown time varying input delays, a simple adaptive controller can produce output regulation to a neighborhood with radius dependent upon the size of an upper bound on the delay. This regulation occurs in the presence of persistent disturbances and the convergence is exponential. We conclude with an example to illustrate the behavior of this adaptive control law.

The National Renewable Energy Laboratory (NREL) started a project in 2000 to record long-term, high-frequency (1-Hz) wind power output data from large commercial wind power plants. Outputs from about 330 MW of wind generating capacity from wind power plants in Buffalo Ridge, Minnesota, and Storm Lake, Iowa, are being recorded. Analysis of the collected data shows that although very short-term wind power fluctuations are stochastic, the persistent nature of wind and the large number of turbines in a wind power plant tend to limit the magnitudes and rates of changes in the levels of wind power. Analyses of power data confirm that spatial separation greatly reduces variations in the combined wind power output relative to output from a single wind power plant. Data show that high frequency variations of wind power from two wind power plants 200 km apart are independent of each other, but low frequency power changes can be highly correlated. This fact suggests that time-synchronized power data and meteorological data can aid in the development of statistical models for wind power forecasting.

The goal of this paper is to investigate the use of a very simple direct adaptive controller in the guidance of a large, flexible launch vehicle. The adaptive controller, requiring no on-line information about the plant other than sensor outputs, would be a more robust candidate controller in the presence of unmodeled plant dynamics than a model-based fixed gain linear controller. NASA’s seven-state FRACTAL academic model for ARES I-X was employed as an example launch vehicle on which to develop the controller. To better understand the difficult dynamic issues, we started with a simplified model that incorporated the inherent instability of the plant and the nonminimum phase nature of the dynamics: an inverted pendulum with an attachable slosh tank. We formulated controllers for this simplified plant with slosh dynamics using control algorithms developed only on a reduced–order model consisting of the rigid body dynamics without slosh. The controllers must be designed to reject three different persistent input disturbances: persistent pulse, step, and sine. We assumed that only position feedback was available, and that rates would have to be estimated. For comparison, a fixed gain linear controller was developed using the well-known Linear Quadratic Gaussian methodology employing state estimation to obtain rate estimates. For a stable adaptive controller, we used direct adaptive control theory developed by Balas, et al. For this theory we need CB > 0 and a minimum-phase open-loop transfer function. We employed a new transmission zero selection method to develop a blended output shaping matrix which would satisfy these conditions robustly. We used approximate differentiation filters to obtain rates for the adaptive controller. Again for comparison, we redesigned the LQG controller to use the same blended output matrix and filters. Following the work on the pendulum, the same method was applied to develop an adaptive controller for the FRACTAL launch vehicle model. An adaptive controller stabilizes a rigid body version of FRACTAL over a very long timeline while exceeding all reasonable state and output limits.

In this paper a conditional Extended Kalman Filter is applied to battery model parameter and state estimations. A decision logic, based on battery input and output data, is designed such that parameter update is stopped when persistent excitation conditions are not met. Persistent excitation conditions are represented by a simpler, easier to implement set of calibrations. Examples, both from desktop simulation, and real world vehicle testing, have been provided to support the validity of this algorithm. The proposed strategy has been successfully deployed in production FHEV/PHEV vehicles.

Reliable short-term predictions of the wind power production are critical for both wind farm operations and power system management, where the time scales can vary in the order of several seconds, minutes, hours and days. This comprehensive study mainly aims to quantitatively evaluate and compare the performances of different Box & Jenkins models and backpropagation (BP) neural networks in forecasting the wind power production one-hour ahead. The data employed is the hourly power outputs of an N.E.G. Micon 900-kilowatt wind turbine, which is installed to the east of Valley City, North Dakota. For each type of Box & Jenkins models tested, the model parameters are estimated to determine the corresponding optimal models. For BP network models, different input layer sizes, hidden layer sizes, and learning rates are examined. The evaluation metrics are mean absolute error and root mean squared error. Besides, the persistence model is also employed for purpose of comparison. The results show that in general both best performing Box & Jenkins and BP models can provide better forecasts than the persistence model, while the difference between the Box & Jenkins and BP models is actually insignificant.

This report is the first output in a body of work undertaken to identify operationally feasible suggestions to improve risk communication and community engagement efforts (RCCE) with displaced Rohingya people in Cox’s Bazar. Specifically, these should seek to improve healthcare seeking behaviour and acceptance of essential health services in the camps where the Rohingya reside. It was developed by the Social Science in Humanitarian Action Platform (SSHAP) at the request of the UK Foreign, Commonwealth & Development Office in Bangladesh. As a first step in this process, this review paper synthesises and assesses the quality of evidence landscape available in Cox’s Bazar and how the Rohingya seek and access healthcare services in Cox’s Bazar and presents the findings from key informant interviews on the topic. Findings are structured in five discussion sections: (1) evidence quality; (2) major themes and variations in the evidence; (3) learnings drawn and recommendations commonly made; (4) persistent bottlenecks; and (5) areas for further research. This synthesis will inform a roundtable discussion with key actors working for the Rohingya refugees to identify next steps for RCCE and research efforts in Cox’s Bazar to improve health outcomes among the Rohingya.

1.1 Macroeconomic summary Economic recovery has consistently outperformed the technical staff’s expectations following a steep decline in activity in the second quarter of 2020. At the same time, total and core inflation rates have fallen and remain at low levels, suggesting that a significant element of the reactivation of Colombia’s economy has been related to recovery in potential GDP. This would support the technical staff’s diagnosis of weak aggregate demand and ample excess capacity. The most recently available data on 2020 growth suggests a contraction in economic activity of 6.8%, lower than estimates from January’s Monetary Policy Report (-7.2%). High-frequency indicators suggest that economic performance was significantly more dynamic than expected in January, despite mobility restrictions and quarantine measures. This has also come amid declines in total and core inflation, the latter of which was below January projections if controlling for certain relative price changes. This suggests that the unexpected strength of recent growth contains elements of demand, and that excess capacity, while significant, could be lower than previously estimated. Nevertheless, uncertainty over the measurement of excess capacity continues to be unusually high and marked both by variations in the way different economic sectors and spending components have been affected by the pandemic, and by uneven price behavior. The size of excess capacity, and in particular the evolution of the pandemic in forthcoming quarters, constitute substantial risks to the macroeconomic forecast presented in this report. Despite the unexpected strength of the recovery, the technical staff continues to project ample excess capacity that is expected to remain on the forecast horizon, alongside core inflation that will likely remain below the target. Domestic demand remains below 2019 levels amid unusually significant uncertainty over the size of excess capacity in the economy. High national unemployment (14.6% for February 2021) reflects a loose labor market, while observed total and core inflation continue to be below 2%. Inflationary pressures from the exchange rate are expected to continue to be low, with relatively little pass-through on inflation. This would be compatible with a negative output gap. Excess productive capacity and the expectation of core inflation below the 3% target on the forecast horizon provide a basis for an expansive monetary policy posture. The technical staff’s assessment of certain shocks and their expected effects on the economy, as well as the presence of several sources of uncertainty and related assumptions about their potential macroeconomic impacts, remain a feature of this report. The coronavirus pandemic, in particular, continues to affect the public health environment, and the reopening of Colombia’s economy remains incomplete. The technical staff’s assessment is that the COVID-19 shock has affected both aggregate demand and supply, but that the impact on demand has been deeper and more persistent. Given this persistence, the central forecast accounts for a gradual tightening of the output gap in the absence of new waves of contagion, and as vaccination campaigns progress. The central forecast continues to include an expected increase of total and core inflation rates in the second quarter of 2021, alongside the lapse of the temporary price relief measures put in place in 2020. Additional COVID-19 outbreaks (of uncertain duration and intensity) represent a significant risk factor that could affect these projections. Additionally, the forecast continues to include an upward trend in sovereign risk premiums, reflected by higher levels of public debt that in the wake of the pandemic are likely to persist on the forecast horizon, even in the context of a fiscal adjustment. At the same time, the projection accounts for the shortterm effects on private domestic demand from a fiscal adjustment along the lines of the one currently being proposed by the national government. This would be compatible with a gradual recovery of private domestic demand in 2022. The size and characteristics of the fiscal adjustment that is ultimately implemented, as well as the corresponding market response, represent another source of forecast uncertainty. Newly available information offers evidence of the potential for significant changes to the macroeconomic scenario, though without altering the general diagnosis described above. The most recent data on inflation, growth, fiscal policy, and international financial conditions suggests a more dynamic economy than previously expected. However, a third wave of the pandemic has delayed the re-opening of Colombia’s economy and brought with it a deceleration in economic activity. Detailed descriptions of these considerations and subsequent changes to the macroeconomic forecast are presented below. The expected annual decline in GDP (-0.3%) in the first quarter of 2021 appears to have been less pronounced than projected in January (-4.8%). Partial closures in January to address a second wave of COVID-19 appear to have had a less significant negative impact on the economy than previously estimated. This is reflected in figures related to mobility, energy demand, industry and retail sales, foreign trade, commercial transactions from selected banks, and the national statistics agency’s (DANE) economic tracking indicator (ISE). Output is now expected to have declined annually in the first quarter by 0.3%. Private consumption likely continued to recover, registering levels somewhat above those from the previous year, while public consumption likely increased significantly. While a recovery in investment in both housing and in other buildings and structures is expected, overall investment levels in this case likely continued to be low, and gross fixed capital formation is expected to continue to show significant annual declines. Imports likely recovered to again outpace exports, though both are expected to register significant annual declines. Economic activity that outpaced projections, an increase in oil prices and other export products, and an expected increase in public spending this year account for the upward revision to the 2021 growth forecast (from 4.6% with a range between 2% and 6% in January, to 6.0% with a range between 3% and 7% in April). As a result, the output gap is expected to be smaller and to tighten more rapidly than projected in the previous report, though it is still expected to remain in negative territory on the forecast horizon. Wide forecast intervals reflect the fact that the future evolution of the COVID-19 pandemic remains a significant source of uncertainty on these projections. The delay in the recovery of economic activity as a result of the resurgence of COVID-19 in the first quarter appears to have been less significant than projected in the January report. The central forecast scenario expects this improved performance to continue in 2021 alongside increased consumer and business confidence. Low real interest rates and an active credit supply would also support this dynamic, and the overall conditions would be expected to spur a recovery in consumption and investment. Increased growth in public spending and public works based on the national government’s spending plan (Plan Financiero del Gobierno) are other factors to consider. Additionally, an expected recovery in global demand and higher projected prices for oil and coffee would further contribute to improved external revenues and would favor investment, in particular in the oil sector. Given the above, the technical staff’s 2021 growth forecast has been revised upward from 4.6% in January (range from 2% to 6%) to 6.0% in April (range from 3% to 7%). These projections account for the potential for the third wave of COVID-19 to have a larger and more persistent effect on the economy than the previous wave, while also supposing that there will not be any additional significant waves of the pandemic and that mobility restrictions will be relaxed as a result. Economic growth in 2022 is expected to be 3%, with a range between 1% and 5%. This figure would be lower than projected in the January report (3.6% with a range between 2% and 6%), due to a higher base of comparison given the upward revision to expected GDP in 2021. This forecast also takes into account the likely effects on private demand of a fiscal adjustment of the size currently being proposed by the national government, and which would come into effect in 2022. Excess in productive capacity is now expected to be lower than estimated in January but continues to be significant and affected by high levels of uncertainty, as reflected in the wide forecast intervals. The possibility of new waves of the virus (of uncertain intensity and duration) represents a significant downward risk to projected GDP growth, and is signaled by the lower limits of the ranges provided in this report. Inflation (1.51%) and inflation excluding food and regulated items (0.94%) declined in March compared to December, continuing below the 3% target. The decline in inflation in this period was below projections, explained in large part by unanticipated increases in the costs of certain foods (3.92%) and regulated items (1.52%). An increase in international food and shipping prices, increased foreign demand for beef, and specific upward pressures on perishable food supplies appear to explain a lower-than-expected deceleration in the consumer price index (CPI) for foods. An unexpected increase in regulated items prices came amid unanticipated increases in international fuel prices, on some utilities rates, and for regulated education prices. The decline in annual inflation excluding food and regulated items between December and March was in line with projections from January, though this included downward pressure from a significant reduction in telecommunications rates due to the imminent entry of a new operator. When controlling for the effects of this relative price change, inflation excluding food and regulated items exceeds levels forecast in the previous report. Within this indicator of core inflation, the CPI for goods (1.05%) accelerated due to a reversion of the effects of the VAT-free day in November, which was largely accounted for in February, and possibly by the transmission of a recent depreciation of the peso on domestic prices for certain items (electric and household appliances). For their part, services prices decelerated and showed the lowest rate of annual growth (0.89%) among the large consumer baskets in the CPI. Within the services basket, the annual change in rental prices continued to decline, while those services that continue to experience the most significant restrictions on returning to normal operations (tourism, cinemas, nightlife, etc.) continued to register significant price declines. As previously mentioned, telephone rates also fell significantly due to increased competition in the market. Total inflation is expected to continue to be affected by ample excesses in productive capacity for the remainder of 2021 and 2022, though less so than projected in January. As a result, convergence to the inflation target is now expected to be somewhat faster than estimated in the previous report, assuming the absence of significant additional outbreaks of COVID-19. The technical staff’s year-end inflation projections for 2021 and 2022 have increased, suggesting figures around 3% due largely to variation in food and regulated items prices. The projection for inflation excluding food and regulated items also increased, but remains below 3%. Price relief measures on indirect taxes implemented in 2020 are expected to lapse in the second quarter of 2021, generating a one-off effect on prices and temporarily affecting inflation excluding food and regulated items. However, indexation to low levels of past inflation, weak demand, and ample excess productive capacity are expected to keep core inflation below the target, near 2.3% at the end of 2021 (previously 2.1%). The reversion in 2021 of the effects of some price relief measures on utility rates from 2020 should lead to an increase in the CPI for regulated items in the second half of this year. Annual price changes are now expected to be higher than estimated in the January report due to an increased expected path for fuel prices and unanticipated increases in regulated education prices. The projection for the CPI for foods has increased compared to the previous report, taking into account certain factors that were not anticipated in January (a less favorable agricultural cycle, increased pressure from international prices, and transport costs). Given the above, year-end annual inflation for 2021 and 2022 is now expected to be 3% and 2.8%, respectively, which would be above projections from January (2.3% and 2,7%). For its part, expected inflation based on analyst surveys suggests year-end inflation in 2021 and 2022 of 2.8% and 3.1%, respectively. There remains significant uncertainty surrounding the inflation forecasts included in this report due to several factors: 1) the evolution of the pandemic; 2) the difficulty in evaluating the size and persistence of excess productive capacity; 3) the timing and manner in which price relief measures will lapse; and 4) the future behavior of food prices. Projected 2021 growth in foreign demand (4.4% to 5.2%) and the supposed average oil price (USD 53 to USD 61 per Brent benchmark barrel) were both revised upward. An increase in long-term international interest rates has been reflected in a depreciation of the peso and could result in relatively tighter external financial conditions for emerging market economies, including Colombia. Average growth among Colombia’s trade partners was greater than expected in the fourth quarter of 2020. This, together with a sizable fiscal stimulus approved in the United States and the onset of a massive global vaccination campaign, largely explains the projected increase in foreign demand growth in 2021. The resilience of the goods market in the face of global crisis and an expected normalization in international trade are additional factors. These considerations and the expected continuation of a gradual reduction of mobility restrictions abroad suggest that Colombia’s trade partners could grow on average by 5.2% in 2021 and around 3.4% in 2022. The improved prospects for global economic growth have led to an increase in current and expected oil prices. Production interruptions due to a heavy winter, reduced inventories, and increased supply restrictions instituted by producing countries have also contributed to the increase. Meanwhile, market forecasts and recent Federal Reserve pronouncements suggest that the benchmark interest rate in the U.S. will remain stable for the next two years. Nevertheless, a significant increase in public spending in the country has fostered expectations for greater growth and inflation, as well as increased uncertainty over the moment in which a normalization of monetary policy might begin. This has been reflected in an increase in long-term interest rates. In this context, emerging market economies in the region, including Colombia, have registered increases in sovereign risk premiums and long-term domestic interest rates, and a depreciation of local currencies against the dollar. Recent outbreaks of COVID-19 in several of these economies; limits on vaccine supply and the slow pace of immunization campaigns in some countries; a significant increase in public debt; and tensions between the United States and China, among other factors, all add to a high level of uncertainty surrounding interest rate spreads, external financing conditions, and the future performance of risk premiums. The impact that this environment could have on the exchange rate and on domestic financing conditions represent risks to the macroeconomic and monetary policy forecasts. Domestic financial conditions continue to favor recovery in economic activity. The transmission of reductions to the policy interest rate on credit rates has been significant. The banking portfolio continues to recover amid circumstances that have affected both the supply and demand for loans, and in which some credit risks have materialized. Preferential and ordinary commercial interest rates have fallen to a similar degree as the benchmark interest rate. As is generally the case, this transmission has come at a slower pace for consumer credit rates, and has been further delayed in the case of mortgage rates. Commercial credit levels stabilized above pre-pandemic levels in March, following an increase resulting from significant liquidity requirements for businesses in the second quarter of 2020. The consumer credit portfolio continued to recover and has now surpassed February 2020 levels, though overall growth in the portfolio remains low. At the same time, portfolio projections and default indicators have increased, and credit establishment earnings have come down. Despite this, credit disbursements continue to recover and solvency indicators remain well above regulatory minimums. 1.2 Monetary policy decision In its meetings in March and April the BDBR left the benchmark interest rate unchanged at 1.75%.

Recent data suggest that the technical staff’s appraisals of the condition and development of economic activity, inflation and the labor market have been in line with current trends, marked by a decline in demand and the persistence of ample excess productive capacity. A significant projected fall in output materialized in the second quarter, contributing to a decline in inflation below the 3% target and reflected in a significant deterioration of the labor market. A slow recovery in output and employment is expected to continue for the remainder of 2020 and into next year, alongside growing inflation that should remain below the target. The Colombian economy is likely to undergo a significant recession in 2020 (GDP contraction of 7.6%), though this may be less severe than projected in the previous report (-8.5%). Output is expected to have begun a slow recovery in the second half of this year, though it is not projected to return to pre-pandemic levels in 2021 amid significant global uncertainty. The output decline in the first half of 2020 was less severe than anticipated, thanks to an upward revision in first-quarter GDP and a smaller contraction in the second quarter (-15.5%) than had been projected (-16.5%). Available economic indicators suggest an annual decline in GDP in the third quarter of around 9%. No significant acceleration of COVID-19 cases that would imply a tightening of social distancing measures is presumed for the remainder of this year or in 2021. In that context, a gradual opening of the economy would be expected to continue, with supply in sectors that have been most affected by the pandemic recovering slowly as restrictions on economic activity continue to be relaxed. On the spending side, an improvement in consumer confidence, suppressed demand for goods and services, low interest rates, and higher expected levels of foreign demand should contribute to a recovery in output. A low base of comparison would also help explain the expected increase in GDP in 2021. Based on the conditions laid out above, economic growth in 2020 is expected to be between -9% and -6.5%, with a central value of -7.6%. Growth in 2021 is projected to be between 3% and 7%, with a central value of 4.6% (Graph 1.1). Upward revisions compared to the July report take into account a lower-than-expected fall in first-semester growth and a somewhat faster recovery in the third quarter in some sectors. The forecast intervals for 2020 and 2021 growth tightened somewhat but continue to reflect a high degree of uncertainty over theevolution of the pandemic, the easures required to deal with it, and their effects on global and domestic economic activity.