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BBVA Research Notes This Week's Split Vote in Hold Decision by The Colombian Central Bank

BY MT Newswires | ECONOMIC | 10/01/25 08:03 AM EDT

08:03 AM EDT, 10/01/2025 (MT Newswires) -- The Board of Directors of Colombia's central bank (BanRep) maintained the interest rate at 9.25% in a divided vote on Tuesday, with the majority opting for monetary stability following the rise in inflation to 5.1% in August and increased inflation expectations for 2025 and 2026, said BBVA Research.

Inflation in August increased to 5.1%, with core inflation excluding food and regulated items exceeding the technical team's forecasts, leading to an upward revision in inflation projections and a slower convergence toward the 3% target.

The Flexible Credit Line agreement with the International Monetary Fund was canceled, a decision based on adequate international reserve levels and no anticipated need to use these resources, although it represents a change in the economy's external protection scheme, noted BBVA Research.

The Colombian economy shows signs of recovery with 2.5% growth in Q2, driven by consumption and investment in machinery and civil works, while unemployment stood at 8.6% in August, added BBVA Research.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.

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