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This document examines the evolution and determinants of portfolio flows in the Colombian economy, which comprises investments on public debt bonds, shares, and private bonds. Structural changes along the last few years owed to either regulatory or market shocks are identified. The international…

Banco de la República (the Central Bank of Colombia) generates information for decision-making, accountability, and public dissemination purposes. In particular, the Financial Markets Report is framed within the principle of public disclosure and contributes to fulfill the Bank's service of…

Despite significant declines in 2023, inflation indicators remain above the target of most central banks.

Global inflationary pressures remain high, although showing a downward trend, while economic activity demonstrated greater resilience than expected.

Global inflationary pressures remain high, although they continued to exhibit a downward trend in most countries, mainly due to lower supply pressures.

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.

I. Performance of credit institutionsCredit institutions in Colombia have adequate capital and liquidity levels to confront the materialization of extreme risks of low probability at individual and consolidated levels.

Main characteristics of Banco de la República's reserves management policyReserves are invested in financial assets with high levels of safety and liquidity, characterized by a large secondary market.The percentage of reserves that remains available to cover immediate liquidity needs, called…

According to the most recent information from the Great Integrated Household Survey (GEIH in Spanish), as of May 2023, employment in the national aggregate grew by 3.4% in annual terms, mainly driven by the rural area, which grew by 4.0% annually, while in the urban area employment grew by 2.9%.…

As of August 2023, employment continued to grow in both urban and rural areas. According to data from the Official Colombian Household Survey (GEIH, by its acronym in Spanish), national aggregate employment grew by 4.8% annually, driven mainly by the strong performance of employment in urban areas,…

Data from the household survey for the quarter  moving average ending in February show that annual job growth is slowing, and its levels remain stable. Although employment increased by 3.6% on an annual basis, equivalent to 768,000 new jobs, it has remained relatively stable in recent months.…

Inflation would peak in March and start to gradually decline as of the second quarter of 2023, bringing inflation back to the 3% target over the next two years.

1. Macroeconomic SummaryIn December, headline inflation (13.1%) and the average of the core inflation measures (10.3%) continued to trend upward, posting higher rates than those estimated by the Central Bank's technical staff and surpassing the market average. Inflation expectations for all terms…

As foreseen in the April Report, inflation began to fall in the second quarter of 2023. It is expected to continue declining in the following quarters and return near the 3% target by the end of 2024.

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

IntroductionBanco de la República is celebrating its 100th anniversary in 2023. This is a very significant anniversary and one that provides an opportunity to highlight the contribution the Bank has made to the country’s development. Its track record as guarantor of monetary stability has…

International Macroeconomic Environment 

This Special Report analyzes the dynamics of Colombia’s housing market and mortgage credit with the purpose of identifying potential sources of risk that may affect economic and financial system stability. In particular, it examines the behavior of variables associated with the sector, its…

During 2022, Colombian companies that resorted to international fnancing sources faced interest rate increases and a sharp depreciation of the peso against the dollar (21%). This may have important implications for the balance sheets of real sector companies with a negative exchange rate mismatch…

The increasing digitization of fnancial services has increased the system’s exposure to cyber-attacks. This could compromise the security of the information, its operability and, therefore, its stability. The materialization of a cyber-risk event that affects the payment system could disrupt the…

After the 2008 fnancial crisis, the U.S. Federal Reserve (Fed) drove the benchmark interest rate to historically low levels that became more pronounced in the wake of the covid-19 pandemic. At the same time, starting in March 2020 several measures to provide the market with liquidity were adopted,…

This report analyzes several indicators to measure the concentration of credit and deposit markets in Colombia and in some peer jurisdictions (Mexico, Peru, and Chile). Additionally, recognizing that the relationship between concentration, competition, and market power is not direct, two exercises…

This special report presents an analysis of financial inclusion in the credit market from a gender perspective. In particular, it examines the characteristics of the stock of loans and credit disbursements granted by credit institutions (CIs) to men and women. As of March 2023, gaps are still…

The dynamics of the main markets in which the financial system participates (e.g., credit, deposits, and fund management, among others) are closely linked to the behavior of the household sector, given its preponderant role in each of them. Considering the above and the occurrence of high growth in…

This Special Report analyzes the main sources of market risk for the local financial system and presents an assessment of volatility transmission between the debt and equity markets, with the aim of identifying whether, at a given point in time, a market acted as a generator or a receiver of…