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The Colombian Central Bank raised the intervention rate 25 base points to 5.25%, their website revealed Friday.
The Board cited inflationary pressures from favorable terms of trade and expanding domestic credit as the reasons for the adjustment.
In January Colombia’s inflation rate was 3.54%, keeping it within the Bank’s target rate of 2% to 4%, but the Board decided to act preemptively to prevent excessive expansion.
The Bank’s statement said, “With recent policy changes it is hoped that inflation expectations will converge to the midpoint of the target range.”
The Board also announced that it would continue to limit the purchase of dollars to $20 million per day until at least August this year.
