Colombia’s industrial sector has demonstrated a marked recovery in November 2025, with Industrial Production YoY growth accelerating to 5.20%. This figure outpaces both the previous month’s 1.00% and the 12-month average of approximately 1.90%, signaling a strong rebound in manufacturing, mining, and utilities output. The surge is notable given the volatility seen earlier in the year, including a low of -3.30% in June 2025.

Drivers this month

• Manufacturing output expanded by an estimated 6.00%, driven by increased demand for consumer goods and intermediate products.
• Mining and quarrying activities rose 4.50%, benefiting from higher commodity prices and export demand.
• Utilities production grew 3.80%, supported by infrastructure investments and seasonal factors.

Policy pulse

The current reading sits comfortably above the central bank’s inflation target range of 2-4%, suggesting that industrial growth is contributing to upward price pressures. The Banco de la República has maintained a cautious monetary policy stance, keeping the benchmark interest rate steady at 7.50% to balance growth with inflation control.

Market lens

Immediate reaction: The Colombian peso (COP) appreciated 0.40% against the USD within the first hour of the release, reflecting investor confidence in the industrial rebound. Short-term government bond yields edged up by 5 basis points, while equity indices such as the COLCAP showed a modest 0.60% gain.

Industrial Production is a core macroeconomic indicator that captures the output of Colombia’s manufacturing, mining, and utilities sectors. Its growth trajectory is closely linked to GDP performance, employment trends, and trade balances. The 5.20% YoY increase in November 2025 contrasts sharply with the contraction of -3.30% recorded in June 2025, underscoring a volatile but improving industrial cycle.

Monetary Policy & Financial Conditions

The Banco de la República’s steady policy rate at 7.50% reflects a balancing act between supporting growth and containing inflation, which stood at 4.30% YoY in October 2025. Financial conditions remain moderately tight, with credit growth slowing to 6.50% YoY, but liquidity injections and stable exchange rates have helped sustain industrial investment.

Fiscal Policy & Government Budget

Fiscal policy remains expansionary, with the government increasing infrastructure spending by 8% in 2025 to stimulate industrial capacity. The budget deficit widened slightly to 3.20% of GDP, reflecting higher public investment and social spending. This fiscal stance supports medium-term industrial growth but raises concerns about debt sustainability.

External Shocks & Geopolitical Risks

Colombia’s industrial sector is exposed to commodity price volatility and geopolitical tensions in key export markets. Recent stabilization in oil prices and easing trade frictions with major partners have bolstered export-oriented industries. However, risks remain from potential disruptions in global supply chains and regional political uncertainties.

Market lens

Immediate reaction: The COP/USD exchange rate strengthened by 0.40% post-release, reflecting positive sentiment. The COLCAP index rose 0.60%, while 2-year government bond yields increased by 5 basis points, signaling expectations of moderate monetary tightening if growth persists.

Looking ahead, Colombia’s industrial production trajectory depends on several factors, including domestic demand, commodity prices, and policy settings. We outline three scenarios for the next 12 months:

Bullish scenario (30% probability)

• Industrial Production YoY accelerates to 6-7% by mid-2026, driven by sustained export growth and infrastructure investments.
• Monetary policy remains accommodative, supporting credit expansion and capital spending.
• Global commodity prices stabilize or rise, boosting mining output and fiscal revenues.

Base scenario (50% probability)

• Industrial Production growth moderates to 3-5%, reflecting balanced domestic demand and external conditions.
• Monetary tightening resumes gradually to contain inflationary pressures.
• Fiscal policy remains supportive but cautious, maintaining deficit control.

Bearish scenario (20% probability)

• Industrial Production contracts or stagnates due to external shocks, such as commodity price declines or geopolitical tensions.
• Monetary policy tightens aggressively, dampening investment.
• Fiscal consolidation pressures reduce public spending, slowing infrastructure projects.

Policy pulse

Banco de la República’s next moves will hinge on inflation trends and industrial momentum. A sustained above-target inflation could prompt rate hikes, while a slowdown might delay tightening.

Market lens

Financial markets will closely watch industrial data for clues on economic health. Positive surprises tend to strengthen the COP and lift equities, while disappointments increase volatility and risk aversion.

Colombia’s November 2025 Industrial Production YoY growth of 5.20% signals a strong rebound in the industrial sector, reflecting improving domestic demand, favorable external conditions, and supportive fiscal policy. While risks from inflation, monetary tightening, and external shocks remain, the data points to a resilient industrial base that could underpin broader economic expansion in the near term.

Investors and policymakers should monitor upcoming releases and related indicators closely, as sustained industrial growth will be critical for employment, fiscal health, and Colombia’s integration into global value chains.

Key Markets Likely to React to Industrial Production YoY

Industrial Production YoY data significantly influences Colombia’s financial markets, affecting currency, equity, and bond prices. The following tradable symbols historically correlate with industrial activity and macroeconomic shifts:

• ECOPETROL – Colombia’s largest oil company, sensitive to industrial and commodity cycles.
• COPUSD – The Colombian peso against the US dollar, reflecting economic sentiment and capital flows.
• GRUPO-AVAL – A major financial group, impacted by credit growth linked to industrial expansion.
• BTCUSD – Bitcoin, often a risk sentiment barometer, reacts to macroeconomic shifts globally.
• USDCOP – The inverse of COPUSD, useful for tracking peso volatility post-data releases.

Indicator vs. ECOPETROL Price Since 2020

Since 2020, Colombia’s Industrial Production YoY and ECOPETROL’s stock price have shown a positive correlation, with industrial growth boosting oil demand and company revenues. Periods of industrial contraction, such as mid-2025, coincided with ECOPETROL price dips, while rebounds in industrial output have supported price recoveries. This relationship underscores the importance of industrial health for Colombia’s energy sector and equity markets.

FAQ

What is Colombia’s Industrial Production YoY?

It measures the year-over-year percentage change in the output of Colombia’s industrial sectors, including manufacturing, mining, and utilities.

How does Industrial Production YoY affect Colombia’s economy?

It serves as a key indicator of economic health, influencing GDP growth, employment, and trade balances.

Why is the Industrial Production YoY important for investors?

It signals shifts in economic momentum, impacting currency values, stock prices, and bond yields.

Key takeaway: Colombia’s industrial sector is rebounding strongly, with November’s 5.20% YoY growth marking a pivotal recovery that could sustain economic expansion amid evolving policy and external risks.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.

Updated 11/14/25