Colombia | Inflation maintained its downward trend in September and stood at 5.8%

In September, monthly inflation was 0.24% and annual inflation was 5.81%, close to market analysts' expectations, according to Banco de la República's survey (0.27%). With this, the result is 31 bps below the previous month's figure.

Key points

• Key points:
• Food inflation reached an annual variation of 2.7%, decreasing by 65 bps compared to August's figure. The reduction was led by the perishables basket, which registered a downward adjustment of 174 bps to 3.3%, favored in part by a comparison base effect compared to September 2023. Meat and processed meats also declined in annual terms in September, but to a lesser extent.
• Non-food inflation moderated its pace of decline in September, falling by 23 bps from 6.8% to 6.6%. The largest downward adjustment came via the administered prices basket, which stood at 10.2% in annual variation, 98 bps below the figure recorded in the previous year. Within this, electricity contributed to the monthly decrease, while education and water contributed to the increase. Inflation of the basket of goods fell from an annual inflation rate of 0.75% to 0.60%, its lowest level since January 2021.
• Meanwhile, the basket of services registered a slight increase, going from an annual inflation rate of 7.4% to 7.5%. Within this basket, the subclasses of rents, meals at table service establishments, airline tickets and school transportation put upward pressure on inflation.
• BBVA Research expects inflation to continue to decline in the remainder of 2024. Food inflation may continue to decline, despite facing some uncertainty due to weather factors. Non-food inflation, on the other hand, will continue to fall, at a moderate pace due to the persistence of inflation in the services basket and despite risks such as the rise in diesel and gasoline prices, which may delay the path of declines.

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