Colombia’s economy continues to grow without spawning inflationary pressures, leading the nation’s central bank to expect “with a high degree of confidence” that price increases for this year and 2011 will be within its target range of 2% to 4%, according to the central bank’s minutes released Friday.
“The Colombian economy is growing at the anticipated rate, without bringing inflationary pressure to bear,” the central bank said in the minutes for the last meeting of its seven-member board held on Sept. 24.
The Colombian economy is recovering from a tepid performance in 2009, when it expanded 0.8%. In the second quarter of this year, the gross domestic product was up 4.5%. Consumer prices declined 0.14% in September while inflation over the 12 months through September was 2.28%.
“The economy is still being bolstered by internal demand, including total investment and government consumption,” the central bank said. The minutes showed some concern for the outlook for the third quarter, warning that “economic growth could slow in a number of branches such as transportation, energy, gas and water, and industry.
“The figures on demand are more favorable, particularly with respect to household consumption,” the central bank said.
The low inflation readings allowed the bank to slash its benchmark interest rate to 3% earlier this year. Most analysts expect the central bank to hold that rate until 2011.
