Office of the Deputy Technical Governor

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.

I. Performance of Credit Institutions (CIs) 

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.

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…

I. Desempeño de los establecimientos de crédito

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 Institutions

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

The purpose of the Financial Stability Report is to present Banco de la República (the Central Bank of Colombia)'s assessment of the recent performance of credit institutions and their borrowers, as well as the main risks and vulnerabilities that could affect the financial stability of the…

Banco de la República’s main goal is to preserve the purchasing power of the currency in coordination with the general economic policy that is intended to stabilize output and employment at long-term sustainable levels.

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.

Banco de la República's monitoring of the local financial market infrastructure is an additional contribution to the country's financial stability. One of the products of that monitoring has been the Payment Systems Report, which is now known as the Financial Infrastructure Report. The change in…

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.

In 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…