2023-06-30 23:40:00
Colombia’s central bank kept borrowing costs unchanged on Friday, likely ending its most aggressive tightening cycle in history in the face of slowing inflation and an economy losing momentum.
The seven-member board voted to keep the reference interest rate at 13.25% for the first time in nearly two years, the general manager said, Leonardo Villar, to the press in Bogotá. The move was forecast by all 26 analysts surveyed by Bloomberg.
The decision ends a series of 14 consecutive raises which boosted the key rate by 11.5 percentage points from September 2021.
Jerome Powell of the Federal Reserve warns that interest rates might rise before the end of the year
The Colombian central bank it is the last of the five main monetary authorities in Latin America to stop raising rates. Policymakers in Peru, Chile, Brazil and Mexico kept borrowing costs unchanged this month, with some of them already signaling imminent rate cuts.
Inflation in Colombia
In colombia, a two-year increase in consumer prices it reached its highest point in March, with a 24-year high of 13.34%, followed by two months of slowdown that brought the rate to 12.36% in May.
Economists surveyed by the central bank forecast a inflation slowdown to 9.02% by the end of 2023 and 5% in 2024. The central bank targets an annual rate of 3% plus or minus 1 percentage point.
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