Colombia Central Bank Cuts Interest Rates to 10.25% as Inflation Eases
On September 30, 2024, Colombia’s Central Bank reduced its benchmark interest rate from 10.75% to 10.25% for the seventh consecutive time. The decision, aimed at balancing economic growth and inflation control, was supported by four board members.
President Leonardo Villar stated that the move maintains growth cautiously and future decisions will depend on economic data. Recent inflation trends show signs of moderation, with August’s rate at 6.12% down from 11.43% the previous year.
The rate cut is part of the Central Bank’s monetary policy to stimulate economic activity and improve the 1.5% growth in the first half of 2024. Market reactions were mixed with projections predicting a reference rate of 8.5% by the end of 2024.
Following a global trend of monetary easing, Colombia’s central bank aims to bring inflation back to its 3% target by mid-2025. As the country continues its economic recovery, balancing growth stimulation with inflation control is crucial for sustainable growth and price stability.