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Majority Of BanRep Board Still Cautious On Inflation Risks

COLOMBIA
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  • In the minutes to last week’s BanRep monetary policy meeting, policymakers continued to strike a cautious tone, with all members agreeing that rates need to keep falling, but a majority saying at a prudent pace, given on-going inflation concerns. This majority continued to argue that rate cuts of more than 50bp might not be sustainable and could jeopardise the convergence of inflation to target. To recap, five members voted for a 50bp cut last week, with two members voting for a larger 75bp move.
  • The majority remain concerned about sticky services inflation and potential exchange rate pressures, as well as the impact of on-going fiscal uncertainty, while the group voting for a 75bp cut highlighted the decrease in inflation expectations and need to support growth. Going forward, the Board will remain data dependent.
    • The link to the minutes is here.
  • Data wise, the calendar is light today, with focus on July CPI inflation, due on Thursday. The next BanRep MPC meeting will be on September 30.
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  • In the minutes to last week’s BanRep monetary policy meeting, policymakers continued to strike a cautious tone, with all members agreeing that rates need to keep falling, but a majority saying at a prudent pace, given on-going inflation concerns. This majority continued to argue that rate cuts of more than 50bp might not be sustainable and could jeopardise the convergence of inflation to target. To recap, five members voted for a 50bp cut last week, with two members voting for a larger 75bp move.
  • The majority remain concerned about sticky services inflation and potential exchange rate pressures, as well as the impact of on-going fiscal uncertainty, while the group voting for a 75bp cut highlighted the decrease in inflation expectations and need to support growth. Going forward, the Board will remain data dependent.
    • The link to the minutes is here.
  • Data wise, the calendar is light today, with focus on July CPI inflation, due on Thursday. The next BanRep MPC meeting will be on September 30.