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CPI Surprises To Topside, Reaches Five-Year High

  • A recap of the overnight data:
    • December consumer prices rose 5.62% y/y; est. +5.41%
    • December consumer prices rose 0.73% m/m; est. +0.53%
    • December core CPI rises 3.44% y/y
    • December core CPI rises 0.44% m/m
  • Inflation pressure may build further at the start of the year due to a 10% increase in the minimum wage and rises in gasoline and diesel prices. The central bank estimates that the economy expanded 9.8% last year after a 6.8% contraction in 2020.
  • The next BanRep decision falls on January 28. Following three of the seven board members voting for a bolder 75bps increase in December, the overnight figures significantly increase the potential for the central bank board to accelerate the pace of tightening.

Colombia Annual CPI Rises To Best Levels Since 2016 (Source: Bloomberg)

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