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Scotiabank Sees Banrep Waiting Until Dec’23 or Jan’24 for First Rate Cut

COLOMBIA
  • Scotiabank write that the last line of the Banrep statement emphasized the need to be prudent and not start an easing cycle that could be unsustainable in the future. Additionally, they added that high inflation plays a negative role in terms of sustainable long-run growth and social equality.
  • This demonstrates that BanRep is still very focused on inflation convergence, and despite some economic signals revealing weaknesses, the board didn’t show a significant concern.
  • All in all, it seems BanRep wants to see more significant progress in inflation before starting the easing cycle. They think a rate cut in December 2023 or January 2024 is most likely. They think BanRep would prefer to wait and see what happens with the minimum wage before starting the easing cycle.

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