The board of directors of the Bank of the Republic held, this Thursday 29, its meeting for the month of September, in which the manager of the Issuer, Leonardo Villar, announced that the technical team of the Banco de la República revised upwards its growth forecast for 2022, from 6.9% to 7.8%, but cut that of 2023, from 1.1% to 0.7%.
(See: The direction the economy would take: GDP would distance itself from high rates).
According to the Bank, for the coming months “there are signs of a slowdown in productive activity”.
Likewise, the Minister of Finance, José Antonio Ocampo, mentioned that until the second quarter the growth rates were very positive, but “There are already beginning to be different signs of a slowdown in the economy and, in addition, the international context is very adverse both in terms of inflation and productive activity”.
(See: The direction that the economy would take: GDP would distance itself from high rates).
The Issuer’s board of directors makes a monetary policy decision at its meeting and agreed an increase of 100 basic points (bp) in the interest rate, with which it stood at 10%. Six of the co-directors voted in favor of this increase and one for an increase of 50 basis points.
(See: Banco de la República raises interest rates to 10%).
“The fight against inflation is the number 1 objective that the constitution gave to the Bank’s board of directors, we hope that these decisions will have some effect in terms of curbing inflation and we can return to the goal that has been very successful, of 3%”, said Ocampo, and recalled that the atypical situations of recent years have made it difficult to return to that range.
(See: Colombian exports: what should be improved and strengthened).
Villar, for his part, stressed that the board is trying to “guarantee a gradual convergence of inflation, from these levels that are above 10% at the moment, towards that medium-term goal of 3%”.
Leonardo Villar, manager of the Bank of the Republic.
Paul Salgado
According to the manager, this is to be done in such a way that “generate the lowest possible costs to economic activity in the short term and under the perception that low inflation, in the long term, contributes to higher growth”.
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