BOGOTA – Colombia’s February inflation data was a surprise for everyone, including central bank co-director Roberto Steiner, the official said on Wednesday, one of seven people who sits on the monetary authority’s board.
Colombia’s consumer prices rose 1.63% in February, taking the 12-month inflation figure to 8.01%, far from the central bank’s annual target of 3%.
“The inflation figure…in February took practically everyone by surprise and it certainly took me by surprise,” Steiner said during a virtual conference. “It is a figure worse than we expected, and we were expecting a high figure.”
The spike in inflation follows international supply-chain pressures as well as the crisis caused by Russia’s invasion of Ukraine, added to local impacts including protests in Colombia in 2021 and a 10% hike in the minimum wage.
“Forecasts (for inflation) are rising, it is cause for concern,” Steiner said, adding that sharply rising oil prices “will have repercussions that aren’t favorable for the Colombian economy.”
Analysts forecast that Colombia’s inflationary pressures will push the central bank to step on the gas in raising its benchmark interest rate, with forecasts pointing to a 125 basis-point hike, which would take the rate to 5.25%, from a current 4%.
(Reporting by Carlos Vargas; Writing by Nelson Bocanegra and Oliver Griffin; Editing by Sam Holmes)