Colombia Monetary Policy


Central Bank stays put at December's meeting

The Central Bank (BanRep) maintained its reference interest rate unchanged at 3.25% at its most recent monetary policy meeting, which took place on 20 December 2013. All of the LatinFocus Consensus Forecast panelists had expected the Bank to make this decision. The key policy rate is at the lowest level since February 2011 and has remained thus since March 2013.

BanRep stated that growth in advanced economies continues to recover, whereas growth in emerging markets is "heterogeneous." The Bank noted that economic indicators suggest that fourth quarter domestic growth was strong. In terms of price developments, the Central Bank stated that annual inflation declined in November, mainly due to changes in regulated prices. Inflation expectations for 2014 remain stable and well anchored within the Bank's tolerance margin of plus/minus 1.0 percentage points around its 3.0% target.

The Bank announced that it would buy up to USD 1.0 billion during the January-March period, which matched the amount purchased between October and December.

LatinFocus Consensus Forecast panelists see the policy rate at 4.18% at the end of 2014. Panelists expect the policy rate to end 2015 at 4.91%.

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Colombia Monetary Policy Chart

Colombia Monetary Policy December 2013

Note: Central Bank policy rate in %, eop.
Source: Colombia Central Bank.

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