Colombia | BanRep increased its benchmark rate 100bps to 11.25% in March

Summary

The Central Bank increased the interest rate by 100 basis points to 11.25% due to persistent core inflation and high inflation expectations. The decision was divided with 4 members supporting the increase.

Key points

• Key points:
• The Board of Directors raised the rate to 11.25% with a vote of four members in favor of the 100bp hike, two for a 50bp cut, and one for stability.
• Core inflation, excluding food and regulated items, showed an upward trend reaching 5.5% in February 2026, surpassing the 5.0% recorded at the end of 2025.
• Analysts' inflation expectations for 2027 remain at 4.8%, while those derived from the public debt market stand close to 7.0%.
• Economic growth in 2025 ended at 2.6%, a figure lower than expected, although the Bank's technical team forecasts that activity will remain above 2.0% in 2026.
• Additional adjustments of 100bp are anticipated for the remainder of 2026, conditional on risks such as the "El Niño" phenomenon and the impact of global energy prices due to the conflict in Iran.

Geographies

Topics

Tags