Office of the Deputy Technical Governor

A weaker fiscal position can increase the economy’s vulnerability to external shocks and limit the scope for policy responses. This vulnerability may translate into higher risks for the financial system.

Inflation increased more than the Bank anticipated during the second quarter of the year. However, with a cautious monetary policy and no significant increases in labor costs, prices are projected to rise at a slower pace, closer to the 3% target, in 2026 and 2027.

Between September 2024 and March 2025, the global economy was characterized by high uncertainty and increased volatility in financial markets. In Colombia, the economy continued to show signs of recovery and inflation kept declining, although fiscal risks increased.

In March, inflation decreased - although less than anticipated - and remains above the 3% target. Over the next two years, it is expected that inflation will continue to decline, converging gradually toward the target.

Delinquency in the commercial loan portfolio has increased, particularly in the commerce sector, due to the post-pandemic economic adjustment. An increase in credit demand could help mitigate this vulnerability.

Inflation has fallen significantly, from 9.3% in 2023 to 5.2% in 2024. During this year and into the next, inflation would continue to decline towards the inflation target.

In the third quarter, headline inflation continued to decrease and is expected to continue doing so gradually to reach 3.0% by the end of 2025.

As of September 2024, the likelihood of a reduction in the U.S. Federal Reserve policy rate has increased, raising the possibility that external financial conditions may loosen by the end of 2024.

During the second quarter, headline inflation remained stable, while core inflation continued to fall. Inflation would continue its measured downward path to meet its 3.0% target by the end of 2025.

The analysis presented in this edition of the Report allows concluding that the Colombian financial system has ample liquidity and solvency levels which are sufficient to confront the occurrence of extreme and tail risk events.

Annual inflation has been decreasing for a year and is projected to continue, with inflation at 5.5% in December and the 3% target to be reached in 2025.

Inflation continues to decline but remains well above 3%. It is anticipated to decrease significantly in 2024 and draw closer to the established target in the first half of 2025.

Inflation has decreased since April, and it is projected to continue to reduce significantly throughout 2024 as it converges toward 3%.

Each edition of the report has four objectives: 

1) to publicize a consolidated account of how the figures for payment infrastructures have evolved with respect to both financial assets and goods and services; 

2) to summarize the issues that are being debated…