Colombia’s central bank should continue its $30 million-a-day program of dollar purchases until the end of December, beyond its current May 31 end date, Finance Minister Mauricio Cardenas said.
Cardenas said he will make the recommendation at the central bank’s policy meeting this month.
“This will be a very important theme at the next board meeting,” Cardenas said. “My position is that we should continue the program of buying international reserves in the same terms and conditions until year-end.”
The central bank said Jan. 28 that it will buy at least $30 million a day, bringing purchases in the foreign-exchange market to $3 billion between February and May. Cardenas has said repeatedly that government intervention can help weaken the peso toward its “equilibrium” level of about 1,900 per U.S. dollar.
The currency has strengthened 22 percent since the start of 2009, the best performer after the Chilean peso among 24 major emerging market currencies tracked by Bloomberg. The peso weakened 0.1 percent to 1842.80 per U.S. dollar today.
Industrial output fell 11.5 percent in March from a year earlier, the biggest decline since 2009. Cardenas said the drop was a “statistical effect” caused by the Easter holidays, and that output would have grown 0.5 percent without the greater number of public holidays. The April industrial production figures will be “good” he said.
Cardenas chairs the central bank’s seven-member policy committee, which next meets May 31. The central bank has cut its policy rate 2 percentage points over the last year, as industrial output slumped and the annual inflation rate fell to a six-decade low.