Colombia Raises Interest Rate for 2nd Straight Meeting


At its May 30th, 2014 meeting, Central Bank of Colombia decided to increase the benchmark interest rate by 25 bps to 3.75 percent, as the inflation rate continued its expected convergence toward the central bank’s 3 percent target.

The decision was unanimous and follows last meeting’s surprise rate increase, the first in nearly two years.

In April, the annual inflation rate accelerated for the fifth consecutive month to 2.72 percent, remaining closer to the lower limit of the central bank's 2-4 percent target range. Policymakers said that inflation expectations for the year increased from last month and expect domestic demand to keep growing and the economy to approach full use of its production capacity in 2014. The seasonally adjusted unemployment rate kept its downward trend and fell for the third straight time to 9 percent in April. 

For 2014, the central bank expects the economy to expand 4.3 percent.

Joana Taborda | joana.taborda@tradingeconomics.com
6/2/2014 11:40:01 AM