OLD Monetary Policy

Transparency is fundamental to accountability on the part of independent central banks. Because they have been granted greater independence, the transparency of these institutions is seen as a mechanism that offers society the ability to assess whether a central bank's actions are consistent…

Banco de la República establishes the benchmark interest rate based on an analysis of the current state of the economy, its outlook, and developments in the inflation forecast with respect to the target.  If this assessment indicates there are risks of inflation persistently…

The purpose of monetary policy in Colombia is to keep inflation low and stable and to achieve the highest sustainable level of output and employment.  In doing so, monetary policy fulfills the constitutional mandate to maintain the purchasing power of the Colombian peso and…

Monetary policy should continuously assess the state of the economy, as well as its future developments and prospects over the next four to eight quarterly terms. It is during this time span that changes in interest-rate intervention rates have their effect on other interest rates…

As for the monetary policy instruments used to meet the inflation target, Banco de la República holds repo auctions to provide liquidity to the banking system by granting overnight loans, and occasionally longer ones, all with the purpose of bringing the overnight interbank rate (IBR) near to…

A low and stable inflation rate improves the well being of the population. This is manifested in various ways:

The primary objective of monetary policy is to reach and maintain a low and stable inflation rate, and to achieve a long-term GDP growth trend.

This is the only way to achieve sustained growth rates that will generate employment and improve the population’s…