The Board of Directors of the Banco de la República kept its benchmark interest rate unchanged at 12.25 percent on 30 October. The decision followed a 25 basis point increase at the previous meeting, the first chaired by Finance Minister Miguel Gómez.
Inflation rebounded slightly to 6.03 percent, the bank’s general manager, Leonardo Villar, said, slightly below expectations. Core inflation fell from 6.1 percent to 6 percent.
Expectations and growth
Analysts’ inflation expectations for December 2026 rose to 6.8 percent in the September survey, Villar said. For a two-year horizon they fell to 4 percent.
Economic activity slowed, with growth at 1.1 percent in July. The exchange rate also factored into the board’s assessment.
Fiscal bill and El Niño
Villar said El Niño is an important upside risk to food and regulated prices. He also said a fiscal adjustment like the one proposed in the government’s Ley de Rescate would help monetary policy meet its objectives.
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The board stressed the need for a rigorous study of the bill, which is before Congress.
Before the announcement, a Citigroup survey of 21 analysts showed 13 expecting a 25 basis point increase to 12.50 percent and eight expecting no change.
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Source: Banco de la República
