BOGOTA (Reuters) – Colombia’s consumer prices increases are unlikely to meet the central bank’s long-term 3% target next year, Finance Minister Alberto Carrasquilla said on Friday.
A long coronavirus lockdown earlier this year and associated business closures and job losses have kept consumer demand weak in the Andean country, with analysts repeatedly over-estimating inflation increases.
Twelve-month price growth was 1.49% in November, though analysts had expected 1.7%.
“Unfortunately I don’t think we can meet the central bank’s target, which is 3%,” Carrasquilla said at a virtual business event. “We will only gradually return to the target.”
In a June revision of its fiscal targets, the government had projected inflation of 3% for 2021.
The central bank took advantage of low inflation to gradually cut 250 basis points from the benchmark interest rate, before holding borrowing costs at a historic low of 1.75%.
(Reporting by Carlos Vargas; Writing by Julia Symmes Cobb; Editing by Tom Brown)