Colombia’s central bank has revised its inflation forecast for 2024, increasing it to 5.7% from the previously projected 5.5%, according to a quarterly report published on Friday. Despite the revision, the new forecast still exceeds the bank’s long-term inflation target of 3%.
For 2025, the central bank’s technical team expects inflation to align closer to the 3% target. These forecasts are integral to the monetary policy decisions made by the bank’s board of directors.
The report also suggests that economic activity in Colombia could continue to recover throughout the remainder of 2024 and into 2025. This recovery is expected to occur amid gradually easing external financing conditions and a less restrictive monetary policy.
As of the end of June, Colombia’s 12-month inflation rate stood at 7.18%. Additionally, for the second quarter of 2024, the technical team forecasts economic growth of 1.8%. The government’s DANE statistics agency is scheduled to release the official second-quarter growth data on August 15.
In related news, Colombia’s central bank cut its benchmark interest rate by 50 basis points to 10.75% on Wednesday, marking its sixth rate cut since December.
Information sourced from Reuters.
