Colombia: Central Bank keeps interest rates on hold
September 30, 2011
At its 30 September monetary policy meeting, the Central Bank kept its reference interest rate unchanged at 4.50% for a second consecutive month, as expected by the market. The Central Bank cited the deteriorating global economic outlook as the main reason behind its decision not to raise rates. Moreover, due to high financial market volatility, and the recent depreciation of the Colombian peso (COP), the Bank decided to end its programme of daily USD 20 million purchases. Instead, the monetary authorities announced that they will intervene in the spot market by either buying or selling USD 200 million as soon as the COP appreciates or depreciates by more than 2% compared with its 10 day moving average. The next monetary policy meeting is scheduled for 28 October.