Colombia: Inflation falls for eighth consecutive month in March
April 5, 2017
In March, consumer prices rose 0.47% from the previous month. The reading followed the 1.01% increase recorded in February, and undershot market expectations of a 0.51% rise. According to Colombia’s National Statistics Institute (DANE), March’s softer increase was driven by a timid rise in prices for food—the category with the largest weight in the consumer price index.
Inflation reached a multi-year high of 9.0% in July and has fallen every month since then thanks to BanRep’s tightening cycle last year as well as to the fading of temporary supply shocks that had stoked price pressures. In March, inflation fell to 4.7% from 5.2% in February, marking the lowest reading since July 2015. However, inflation is still above the Central Bank’s tolerance margin of plus/minus 1.0 percentage point around its 3.0% target.
Core consumer prices, which exclude volatile items such as fresh food and fuels, increased 0.52% from the previous month in March, above the 1.11% rise in February. Finally, core inflation inched down from 6.6% in February to 6.5% in March.
Author: Luis Lopez Vivas, Economist