In April 2025, the Central Bank of Colombia made a strategic decision to reduce its benchmark policy rate by 25 basis points, bringing it down to 9.25%. This decision was reached with a unanimous vote by the Board. Observing the economic climate, annual inflation has resumed a downward trajectory, decreasing from 5.3% in February to 5.1% in March. Additionally, core inflation, which excludes food and regulated prices, has further softened, standing at 4.8%, down from 4.9%. Early indicators for the first quarter reveal that the GDP experienced a year-on-year growth of 2.5%, prompting the technical team to adjust the growth forecast for 2025 upwards to 2.6%, and projected growth for 2026 to 3.0%.
Despite these positive signs, external financing conditions have tightened due to ongoing global trade tensions, increased volatility in financial markets, and a strengthening US dollar. These factors have contributed to an increase in Colombia's risk premium and are maintaining inflationary pressures, thereby limiting the capacity for more substantial rate cuts. The Board has made it clear that subsequent policy decisions will be guided by forthcoming economic data.
