National Bank of Colombia Eases Again

September 30, 2013

Colombia’s monetary policy rate had held steady at 5.25% for fifteen months, but easing resumed in the third quarter of 2013 with cuts of 25 basis points at the start of July, 50 bps in August and another 25 bps to 4.25% today.  An accompanying statement explains, “The resumption in disinflation has enabled a new cycle of monetary policy easing, in the context of the central bank effectively anchoring inflation expectations and closely monitoring domestic and external developments.”  Real GDP grew just 1.4% in the year to 2Q13, adding to Colombia’s output gap, and core inflation of 2.2% lies below the 2.5% target.  The Board’s next monetary policy meeting is set for November 5.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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