Colombia Economic Outlook, Fourth Quarter 2014

The economy will expand by 4.9% in 2014 and in 2015 will enjoy more balanced growth; the negative effects of the tax reform and the lower terms of trade will be partly offset by the recovery of industry and a more robust private consumption. Inflation will close 2014 at 3.5% as we have been forecasting. A weaker Niño phenomenon, and a reduced likelihood of it happening, will bring inflation down to 3.3% by the end of 2015. Monetary policy normalisation: in the middle of financial tensions, without inflationary pressures and with GDP close to its potential, the central bank will leave the rate at 4.5% and keep it there until at least the second half of 2015.

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