By Nelson Bocanegra
BOGOTA (Reuters) – Colombia’s inflation could have slowed in October but forecasts for consumer price growth through the year end rose due to uncertainty caused by the El Nino weather phenomenon, a Reuters poll found on Monday.
According to the median forecast from 17 analysts, consumer prices could have risen 0.35% n October, slower than the 0.54% in September and the 0.93% seen in the same month last year.
Estimates ranged from 0.29% to 0.50%.
If the median forecast is met, inflation for the 12 months through October would hit 10.60%, below the 10.99% through September but still far higher than the central bank’s 3% target.
“We expect moderation in food and housing, and as has become the norm, there could be pressure from gasoline in transport,” said David Cubides, chief economist of the Alianza brokerage, who forecast inflation of 0.31% in October.
The government’s DANE statistics agency will publish October inflation data on Wednesday Nov. 8.
Colombia’s “slow” process of disinflation is aided by the delayed effect of tighter financial conditions and the country’s sharp economic slowdown, but “is limited by rising gasoline prices and high indexation,” said Andres Abadia, Phanteon Macroeconomics’ chief economist for Latin America.
Inflation forecasts for the year rose to 9.62%, compared to the 9.30% shown in the previous survey.
The El Nino weather phenomenon leads to drier weather, affecting crops and subsequently food prices.
Analysts also forecast inflation would close 2024 at 5.40%, versus a previous estimate of 5.10%, and estimated that consumer prices would grow 3.80% in 2025.
Persistent inflationary pressure has driven the central bank to hike its benchmark interest rate by 1,150 basis points, taking it to 13.25% from September 2021 to April this year, where board members have since held it stable.
In a recent Reuters poll, analysts forecast the bank board would hold the rate steady at its meeting on Tuesday.
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