Colombia | Annual inflation stood at 11.0% in sept., in line with analysts' expectations

In September, monthly inflation was 0.54% and annual inflation was 11.0%. The results were in line with market analysts' expectations (0.54% for the monthly variation, according to Banco de la República's survey) and ours (0.50%).

Key points

• Key points:
• Food inflation, on the other hand, decreased from 12.4% in August to 11.5% in September, which meant a reduction of 95 basis points compared to the previous month's figure. The leading role was again played by the perishables sub-basket, which rose from 15.2% in August to 15.6% in September, while the meat and processed food sub-baskets continued to decline.
• Core inflation declined in annual variation for the third consecutive month, from 11.2% in August to 10.9% in September, down 31 bps. The largest decrease came from the basket of goods, mainly due to base effects. In this basket, subclasses such as vehicles are already registering negative monthly contributions and the upward pressures are led by items such as body care articles and beer.
• The baskets of services and administered prices did not register significant changes compared to the annual variation from August. In the case of services, rents and school transportation showed the greatest upward pressures and inter-municipal transportation contributed to the decline. In the case of administered prices, upward pressures remain from fuels and from the subclasses associated with education, while gas is pushing downwards.
• At BBVA Research, we expect inflation to continue on a downward path in the last quarter of the year, although it will be pressured by food inflation with upward risks due to the El Niño phenomenon, and with core inflation moderately decreasing.

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