Colombia Seen Keeping Rates On Hold

Market consensus points to Colombia’s central bank keeping its monetary policy rate on hold at 3.0% today. Morgan Stanley agrees, as it believes authorities take comfort in benign inflation data, even though economic growth continues to surprise on the upside. Standard Chartered forecasts that a first rate hike of 50bp would come in December and the policy rate will rise to 5.0% by June 2011. The central bank cut the rate by 50bp to the current 3.0% in April.