MNI Colombia CB Review - Sep 25: Easing Cycle Pause Extended

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Executive Summary

• The Colombian central bank left its overnight lending rate unchanged at 9.25% for a third consecutive meeting in September, in line with expectations. Once again, the decision was split 4-1-2, with one member voting for a 25bp cut and two members voting for a 50bp reduction.
• The decision reflected concerns over the outlook for inflation, which is no longer seen returning to target next year amid a large minimum wage hike.
• Many analysts expect the Board to remain on hold through year-end, although some still see scope for a possible cut in December.