Â© Reuters. SUBMIT PICTURE: General view of Colombia’s reserve bank in Bogota, Colombia October 9, 2019. REUTERS/Luisa Gonzalez
By Nelson Bocanegra
BOGOTA (Reuters) – The marketplace is divided about whether Colombia’s reserve bank board will raise its benchmark rates of interest in a last walking in its tightening up cycle or hold loaning expenses as it weighs inflation and development dangers at its conference on Friday.
Fifteen of 26 experts in a Reuters study recently anticipated the seven-member board will hold the rate at 13%, while the staying 11 forecasted a 25 basis point boost 13.25%.
A hold would be the very first given that September 2021.
Inbound Financing Minister Ricardo Bonilla, who will take workplace on May 1, informed regional radio on Thursday he anticipates a hold due to the fact that of a decrease in food cost inflation.
Outbound minister Jose Antonio Ocampo will go to Friday’s conference in representation of the federal government.
” I anticipate the bank to stop raising rates and there will now be some area so that in the 2nd half rate of interest start to fall,” Bonilla stated.
Nevertheless, a few of the marketplace thinks one last walking is essential to anchor inflation expectations, provided 12-month customer cost boosts were 13.34% in March, more than 4 times the bank’s target.
” We believe this will be the last increase of the cycle and after that the reserve bank will leave the rates of interest steady up until a minimum of the 4th quarter,” stated Felipe Klein, BNP Paribas (OTC:-RRB- financial expert for Latin America.
The board has actually raised loaning expenses by 1,125 points given that late 2021 as financial development sent out inflation skyrocketing. Colombia’s economy broadened 7.5% in 2015.
The bank’s technical group anticipates financial development will slow to 0.84% this year and inflation will reach 8.7%.