Monday, May 30, 2011

Colombia Central Bank Raises Rate 25bps to 4.00%

The Central Bank of Colombia increased its benchmark monetary policy interest rate by 25 basis points to 4.00% from 3.75% previously.  The Bank also extended its $20 million dollar per day foreign exchange market purchase plan to 30 September, from an initial expiry date of 17 June.  Central Bank Governor, Jose Dario Uribe, said: "Adjustments toward a less-expansive monetary policy should continue,".

Colombia reported annual inflation of 2.84% in April, compared to 3.19% in March, and a rate of 1.84% in April 2010, this compares to the Bank's inflation target of 3%.  Total gross lending increased 21% to 183.6 trillion pesos ($102 billion) in March 2011.  Goldman Sachs is forecasting 2011 GDP growth at 5.5%, while Morgan Stanley is forecasting 4.9% growth for the Colombian economy.


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