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

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.

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.

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 

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,…

Law 2381 of 2024, “Whereby the Comprehensive Social Protection System for Old Age Disability, and Death (Sistema de Protección Social Integral para la Vejez, Invalidez y Muerte, in Spanish) of common origin is established, and other provisions are issued,” creates the Reserve Fund of the…

Monetary policy plays a fundamental role in the pursuit of economic stability and its effectiveness is closely linked to its credibility. In the context of monetary policy, credibility refers to the degree of confidence that economic agents have that the central bank will achieve its objectives of…

The levels of the monetary policy interest rate (MPR) are periodically set after deliberation processes within the Board of Directors of Banco de la República (the Central Bank of Colombia). These discussions are informed by a detailed assessment of the performance of inflation, inflation…

Foreign investors made significant sales of their holdings of local public debt securities during 2023. Specifically, they sold COP 9.1 t in peso-denominated TES and COP 2.4 t in UVR-denominated TES respectively. This represented a 11.7% decrease in their balance in pesos compared to what was seen…

The monetary policy of Banco de la República (the Central Bank of Colombia) aims to maintain a low and stable inflation rate in coordination with overall economic policy. To achieve this, Banrep follows an inflation targeting framework within a flexible exchange rate regime; in other words,…

ApproachFiscal rules, also known as fiscal responsibility norms, refer to restrictive measures of fiscal policy at either the national or subnational level, through which the sustainability of public finances is sought to be guaranteed. These rules can be quantitative (those that set numerical…

Inflation indicators remain above the target of most central banks despite continuing to show a decline in most countries.

Inflation indicators surpassed expectations, staying above the targets set by most central banks.

The global economy proved resilient during the period analyzed, although signs of a slowdown emerged towards the end of the quarter.

I. Performance of Credit Institutions (CIs) 

La dinámica de los principales mercados en los que el sistema financiero participa (e.g. crédito, depósitos y administración de fondos, entre otros) se encuentra estrechamente vinculada al comportamiento del sector de hogares, dado su papel preponderante en cada uno de estos.

Rising Corporate DelinquencyDelinquency 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.

1. First vulnerability: Sudden changes in global financial conditionsAs 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.

International macroeconomic environmentThe global economy would continue to grow in 2024 at a rate slightly higher than 3.0%, according to forecasts from the International Monetary Fund (3.2%) and the Organization for Economic Cooperation and Development (3.1%).This dynamic is lower than the pre-…

International Macroeconomic EnvironmentIMF measurements indicate that global gross domestic product (GDP) growth was reduced from 3.5% in 2022 to 3.1% in 2023, and according to World Bank estimates, from 3.3% to 3.0%.

Este reporte presenta los resultados de la Encuesta trimestral sobre la situación del crédito en Colombia con corte a diciembre de 2024, en la que participan los establecimientos de crédito (EC) que otorgan préstamos: bancos, compañías de financiamiento (CFC) y cooperativas financieras (…

Transportation services play a critical role across all sectors of the economy by facilitating the movement of goods and services at all production levels. Although not all goods produced in a country require transportation due to inventory accumulation in industries and businesses or because…