Colombia | Inflation ended 2025 at 5.10%, virtually unchanged from the previous year

Summary

Monthly inflation in December came in at 0.27%, slightly below analysts’ expectations (0.35%). As a result, annual inflation fell to 5.10%, down 20 bps from November, marking two consecutive monthly declines.

Key points

• Key points:
• The decline in headline annual inflation relative to November was driven mainly by food, whose annual inflation fell to 5.07% (-67 bps vs. November).
• In parallel, the non-food basket posted a slight decline in annual inflation to 5.11% (-9 bps vs. November), largely explained by a moderation in administered prices.
• In contrast, inflation excluding food and administered prices—closely monitored by Banco de la República—rose to 5.02% (+16 bps vs. November), pointing to more persistent underlying pressures.
• Compared to year-end 2024, headline inflation remained virtually unchanged at the end of 2025 due to offsetting pressures across baskets. On the one hand, food and goods recorded substantial increases in annual inflation; on the other, services and administered prices moderated significantly.
• Looking ahead, we expect the 23% minimum wage increase, far above what had been projected, to exert significant upward pressure on inflation in 2026. Risks are not limited to minimum-wage-related indexation. In our scenario, inflation would close 2026 significantly above 2024 and 2025 levels.

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