(Reuters) – Colombian President Juan Manuel Santos expressed hope on Wednesday that the central bank would cut the benchmark interest rate at the next board meeting as benign inflation provides room to help economic growth.
Santos, a former finance minister, said in an address in the coastal city of Santa Marta that he hoped low inflation would encourage the bank to cut borrowing costs from the current level of 3.25 percent.
The central bank last week held the rate steady for a fifth straight month but hinted that the economy may require another reduction.
Inflation is expected to end the year below 3 percent, under the mid-point range of the bank’s target range of 2 percent to 4 percent. Inflation numbers are due to be disclosed on Thursday.
Central bank chief Jose Dario Uribe has said there is a risk that economic growth could end this year below 4 percent, the level the board previously said was likely.
Weak industrial output and sluggish exports have crimped expansion in the economy while a series of labor disputes in the coal and farm sector threaten to slow GDP further.
Finance Minister Mauricio Cardenas already has lowered the government’s official economic growth target for 2013 to 4.5 percent from 4.8 percent and suggested another downward revision could be possible.