Preview: Colombia Central Bank Interest Rate Decision expected at 14:00 ET (18:00 GMT)
Expected to raise Overnight Lending Rate by 50bps to 11.75% (**Note: would resume rate hikes under the current tightening cycle) Apr Minutes/Statement: - Vote to keep policy steady was unanimous (7-0) - Consensus was to hold despite diverging views; in an effort to reach agreements in the current situation - Appropriate to send a signal to the country that it is possible to seek agreements, to seek consensus, and for that reason, although we maintain our view that the bank’s benchmark interest rates should be lowered - Balanced inflation concerns with efforts to stoke growth Staff Projections: (last updated in Jan) - Raised 2025 GDP growth forecast from 2.6% to 2.9% - Revised 2026 inflation forecast to 6.3% Recent data: - On Jun 5thth Colombia May CPI M/M: 0.6% v 0.8% prior; Y/Y: 5.8% v 5.7%e (**Note: Colombia has a 3% inflation target. CPI has been above target for the past 58 months) - On Jun 18th Colombia Apr Economic Activity Index (Monthly GDP) Y/Y: 3.3% v 3.2%e - On May 17th Colombia Q1 GDP Q/Q: 0.6% v 0.5%e; Y/Y: 2.2% v 2.0%e (**Note: Q4 GDP YoY was 2.3%) Recent comments: - On Jun 17th Colombia Central Bank Economists Survey maintained 2026 CPI forecast at 6.5% - On Jun.
Expected to raise Overnight Lending Rate by 50bps to 11.75% (**Note: would resume rate hikes under the current tightening cycle) Apr Minutes/Statement: - Vote to keep policy steady was unanimous (7-0) - Consensus was to hold despite diverging views; in an effort to reach agreements in the current situation - Appropriate to send a signal to the country that it is possible to seek agreements, to seek consensus, and for that reason, although we maintain our view that the bank’s benchmark interest rates should be lowered - Balanced inflation concerns with efforts to stoke growth Staff Projections: (last updated in Jan) - Raised 2025 GDP growth forecast from 2.6% to 2.9% - Revised 2026 inflation forecast to 6.3% Recent data: - On Jun 5thth Colombia May CPI M/M: 0.6% v 0.8% prior; Y/Y: 5.8% v 5.7%e (**Note: Colombia has a 3% inflation target.
CPI has been above target for the past 58 months) - On Jun 18th Colombia Apr Economic Activity Index (Monthly GDP) Y/Y: 3.3% v 3.2%e - On May 17th Colombia Q1 GDP Q/Q: 0.6% v 0.5%e; Y/Y: 2.2% v 2.0%e (**Note: Q4 GDP YoY was 2.3%) Recent comments: - On Jun 17th Colombia Central Bank Economists Survey maintained 2026 CPI forecast at 6.5% - On Jun 12th Colombia Fin Min Avila presented its mid term fiscal plan which maintained 2026 GDP growth projection unchanged at 2.6% and set 2027 GDP growth of 2.2% - On May 17th Chile Central Bank (BCCh) Quarterly Monetary Policy Report saw 2026 GDP growth forecast at 1.8% - On May 6th Colombia Central Bank Apr Minutes noted that the decision to keep policy steady was unanimously to avoid election noise. - On Apr 30th Colombia Central Bank left the Overnight Lending Rate unchanged at 11.25% (not expected) for its 1st pause in 3 decisions under the current tightening cycle.
Statement noted that the vote to keep policy steady was unanimous (7-0).
Consensus was to hold despite diverging views; in an effort to reach agreements in the current situation - Appropriate to send a signal to the country that it is possible to seek agreements, to seek consensus **Insight: Colombia Central Bank has raised the Overnight Lending Rate twice under the current tightening cycle by a total of 200bps.
The last hike was in Mar 2026. - The last cut was in Apr 2025.