Central Bank of the Republic of Colombia Tightens

April 26, 2014

The Board considers that macroeconomic stability and the current convergence of inflation towards the long term goal, are compatible with a slightly less expansive monetary policy stance, a little less expansive than the current one.

With that explanation, a 14-month-long low in Colombia’s central bank interest rate was terminated.  The rate was raised to 3.5% from 3.25%.   Seven cuts from July 2012 to March 2013 had previously cut the rate from 5.25% to 3.25%.  But this month’s statement observes improving growth and adopts a pre-emptive decision to withdraw some monetary stimulus given that policy changes impact only after a lag.

Copyright 2014, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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