Colombia April inflation to slow to 0.59%, or 7.15% annual rate: Reuters poll

2024.04.30 12:12

By Nelson Bocanegra

BOGOTA (Reuters) – Colombia’s inflation in April is expected to hit 0.59%, extending its deceleration and taking 12-month consumer price growth to its lowest level in 27 months, according to the median of a Reuters poll published on Tuesday.

Inflation estimates for April from 20 analysts ranged from 0.45% and 0.71%.

If the median is met, 12-month inflation through April 30 would slow to 7.15%, reaching its lowest level since January 2022.

“April is very important because it is the first month where we will be able to effectively see how consistent the decline in inflation is, because the statistical base effects compared to last year have stopped,” said Sergio Olarte, chief economist for Scotiabank in Colombia.

However, inflation would still be more than double the central bank’s 3% target. 

The government’s DANE statistics agency will publish April inflation data on May 8.

Most analysts expect inflation to behave in a way that would allow the central bank to make further cuts to its benchmark interest rate in the short term.

The bank is expected to cut the rate by 50 basis points to 11.75% on Tuesday.

That said, analysts now expect inflation to close the year at 5.67%, up from the 5.51% forecast in last month’s survey.

“The general rise in expectations for the end of the year is explained because public services, especially gas and water, have risen quite a bit, so that is reflected in the models,” Olarte explained.

According to the survey, inflation will end 2025 at 3.80%, as per last month’s poll, while inflation expectations for 2026 slowed to 3.20% from 3.40% last month.

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