By Nelson Bocanegra
BOGOTA (Reuters) – Colombia’s financial development is more likely to have slowed within the third quarter of the 12 months as a result of extra average home consumption amid rising rates of interest and rampant inflation, a Reuters ballot revealed on Thursday.
In keeping with the median of 15 analysts’ estimates, Latin America’s fourth-largest financial system may have expanded 6.7% between July and September.
Financial development through the year-earlier interval hit 13%.
Estimates for third-quarter financial development ranged from 4.8% to 7.5%.
If the median proves right, Colombia’s gross home product (GDP) within the three months to Sept. 30 would even have grown extra slowly than within the second quarter of 2022, when it expanded by 12.6% versus the second quarter of 2021.
The median forecast was barely larger than projections by the nation’s central financial institution, which sees third-quarter financial development at 6.4%.
“Though the financial system nonetheless exhibits signs of highly effective mixture demand, we’ve a robust comparative interval, extra cautious customers as inflation continues to place strain on their wallets, whereas entrepreneurs are assuming larger financing prices,” mentioned Wilson Tovar, chief economist for brokerage Acciones y Valores.
Third quarter GDP development knowledge will likely be revealed subsequent Tuesday.
Colombia’s central financial institution has hiked its benchmark rate of interest to 11%, the best degree in 21 years, in a bid to gradual inflation.
The Andean nation noticed 12-month inflation hit 12.22% in October, the best degree since 1999.
Median estimates recommend Colombia’s financial system might develop by 7.70% this 12 months earlier than slowing to 1.60% in 2023, as central banks increase charges world wide to chill inflation.
“We’re anticipating the central financial institution to observe its path of accelerating the rate of interest, at the least till the primary quarter of 2023 and proper as much as ranges near 12.5% or 13%, as a result of inflation isn’t letting up,” Tovar added.