Colombia central bank sees inflation approaching 3% target by mid-2028

Key facts

• Colombia's central bank anticipates inflation will approach its 3% target by mid-2028.
• Recent projections from the bank's technical team showed inflation at 4.3% by the end of 2027.
• Annual inflation in Colombia stood at 6.03% as of the end of July.
• The country has not met its inflation target since 2021.
• Vice-Minister of Finance Juan Sebastian Betancur believes returning to fiscal rule compliance in the short term is not feasible.

Colombia's central bank forecasts that inflation will move closer to its 3% target by mid-2028, according to central bank chief Leonardo Villar. This projection comes as the country has struggled to meet its inflation goals since 2021, with annual inflation at 6.03% as of the end of July.

Villar noted that strong domestic demand, which outpaces production growth, is creating upward price pressure and complicating the central bank's efforts to control inflation. He made these remarks at a banking conference in Cartagena.

Separately, Juan Sebastian Betancur, Colombia's Vice-Minister of Finance, expressed doubt about the feasibility of returning to compliance with the country's fiscal rule in the near future. He cited the deterioration of public finances as the reason. The government had suspended compliance with the fiscal rule, introduced in 2011 to limit government spending and borrowing, for a three-year period starting in June 2025.