FX.co ★ Colombia Leaves Key Rate Unchanged at 9.25%

The Central Bank of Colombia opted to maintain its benchmark policy rate at 9.25% in June 2025. The decision saw four directors favoring the status quo, while two advocated for a 50 basis point reduction and one suggested a 25 basis point cut. Annual inflation witnessed a notable decrease, dropping to 4.8% in June from the previous 5.1% in May, driven by reductions in food and regulated-price inflation, most notably in electricity. Meanwhile, core inflation, which excludes food and regulated prices, remained steady at 4.8%. The economic activity index climbed by 2.7% year-over-year in May, propelled by tertiary sectors, with the technical team estimating a 2.7% annualized GDP growth rate for the second quarter, fueled by a robust 4.1% expansion in domestic demand. Nevertheless, external financing conditions continue to pose challenges due to global trade tensions, heightened geopolitical uncertainty, and the gradual normalization of U.S. policy rates. The Board stressed that its future policy decisions will be contingent upon the trajectory of inflation and its expectations, the dynamics of economic activity, and the balance of internal and external risks.