Foreign net loans to Colombian companies rose to $1.11 billion in the first seven months of 2011, a rate not seen since 1999, Bloomberg reported Thursday.
The companies are making the most of the near-zero benchmark interest rate in the U.S. to borrow capital for less than in Colombia, where the rate of interest banks charge each other for loans, or interbank rate, is 4.5%.
Andres Pardo, head analyst at financial services holding company Corp. Financiera Colombiana, said that “the peso’s appreciation is clearly something that worries the central bank.” Pardo added policy makers “will seek to limit the significant growth in external borrowing.”
Of the 34 economists interviewed by Bloomberg, 24 were of the opinion that Colombia’s central bank would increase the interest rate to 4.75%, at the board meeting to take place Friday. The remaining 14 thought the board would leave the interest rate at 4.5%.
