Bank of Colombia sees continued economic slowdown, reduced inflation, minutes report

By Richard Connell

New York, Jan. 5 - The Central Bank of Colombia's board of directors cut the intervention interest rate by 50 basis points to 9.5% in response to a forecast of reduced inflation at its Dec. 19 meeting, according to minutes released by the bank on Monday.

The board noted that inflation in November had dropped to 7.73% from 7.94%, remaining above the inflation target range of 4.5% to 5.5%.

The board also examined the continued decline in the global economy and the negative effect it has had on both Colombia and its major trading partners, as export demand has dropped and industrial activity was down 3.3% in the third quarter.

Foreseeing that the economic slowdown will continue and bring down inflationary pressures further, the board voted unanimously to reduce the intervention rate to 9.5%.

This marks the first reduction in the rate in over three years.

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