Meeting minutes show that BC sees greater uncertainty about the fiscal target and advocates consistent pursuit of the target

Last week, the Bank of Colombia decided to make the third reduction of 0.50 percentage points in the Selec interest rate, bringing it to 12.25% annually.

Reuters


7 November 2023 08:27

Central Bank logo on the facade of the headquarters (Marcello Casal Jr/Agência Brasil)

BRASILIA – The Central Bank believes that uncertainty has increased over the government’s ability to achieve set fiscal targets, which has led to increased risks, according to the minutes of the Monetary Policy Committee (COPOM) published on Tuesday, as it returns to defending general monetary policy objectives. Accounts are followed vigorously.

“The Committee assessed that the financial uncertainty is limited to the implementation of the targets that were presented, but noted that in the recent period, uncertainty around the target itself set for the financial outcome has increased, leading to an increase in the risk premium,” the document noted.

Last week, the Bank of Colombia decided to make a third cut of 0.50 percentage points in the Selec interest rate, to 12.25% annually, and stated that its board of directors expects similar cuts in future meetings, despite pointing to the adverse international environment.

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