Money in Colombia
Colombia - Money
Central Bank holds benchmark interest rate at 4.25% at last meeting of the year
At its Board of Directors meeting on 21 December, Colombia’s Central Bank (Banco de la República, BanRep) kept the benchmark interest rate on hold at 4.25%, where it has been since 27 April when the Bank cut the rate by 25 basis points. The latest decision was unanimous and in line with market expectations.
The Bank’s decision to stay put came against the backdrop of weak inflationary pressures as oil prices plummeted in the final three months of 2018. Inflation in November matched October’s 3.3% reading, thus remaining within the Bank’s 2.0%–4.0% target range. Stable inflation and well-anchored expectations led the Bank to remain on hold. As for the real sector, while activity in the persistently weak construction sector picked up—thanks to an upturn in investment in the sector—and domestic demand dynamics firmed up, the sharp decline in oil prices likely weighed on overall economic activity.
The Bank’s accompanying statement indicated a continued neutral stance. However, it provided little forward guidance beyond reiterating that the trajectory of inflation will be monitored closely in the context of global developments, particularly the U.S. Federal Reserve’s tightening cycle, the evolution of oil prices, and global trade tensions. That said, the BanRep is expected to embark on a tightening cycle in 2019 given that the emerging El Niño weather phenomenon and the recently-announced minimum wage hike are likely to stoke prices price pressures. The next monetary policy meeting will be held on 31 January.
LatinFocus Consensus Forecast panelists expect the policy rate to end 2019 at 4.86% and 2020 at 4.95%.
Colombia - Money Data
|Money (annual variation in %)||14.7||9.1||12.5||6.9||5.0|
5 years of economic forecasts for more than 30 economic indicators.
Colombia Money Chart
Source: Colombia Central Bank.
|Bond Yield||6.80||0.0 %||Jan 21|
|Exchange Rate||3,127||-0.17 %||Jan 21|
|Stock Market||11,674||-0.66 %||Jan 21|
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January 18, 2019
According to data released by Colombia’s National Administrative Department of Statistics (DANE) on 18 January, the industrial sector lost some pace, with the year-on-year pace of expansion moderating to 4.7% in November, down from 5.4% in October.
January 16, 2019
The Fedesarrollo consumer confidence index improved in December, rising to minus 8.3 points from minus 19.6 points in November.
January 5, 2019
According to the National Department of Administrative Statistics (DANE), consumer prices rose 0.30% over the previous month in December, after a 0.12% month-on-month increase in November.
January 3, 2019
According to the National Department of Administrative Statistics (DANE), export growth moderated in November.
January 2, 2019
Colombia’s manufacturing sector expanded at broadly the same pace in December as it did in November.