Colombia | BanRep holds rate at 12% and announces a reserve accumulation program

Summary

The Central Bank of Colombia kept the policy rate at 12% in a split decision. Additionally, a reserve accumulation program was announced.

Key points

• Key points:
• Inflation continued its upward trend, reaching 6.14% in June, while core inflation remained stable at 6.0%. Analyst expectations for 2026 stand at 6.6%.
• Economic activity showed signs of acceleration, with the Economic Monitoring Indicator (ISE) growing by 4.1% year-on-year in May. The central bank estimates the economy will grow by 2.5% in 2026.
• Given a high appreciation of the Colombian peso during the year, Banrep announced a gradual international reserve accumulation program for up to 4 billion dollars.
• The reserve accumulation program will be executed through monthly 'put' option auctions. The first auction, for up to 400 million dollars, will be called for August 3, 2026.

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