Former Colombian finance ministers criticize Petro comments on central bank

BOGOTA, Oct 6 (Reuters) – A string of former Colombian finance ministers criticized the Andean nation’s President Gustavo Petro on Thursday after he took to Twitter to query the central financial institution’s choice to hike its benchmark rate of interest final week.

Final Thursday the financial institution’s board voted by majority to boost the speed by 100 foundation factors to 10%, inline with different central banks as world financial coverage authorities battle with rampant inflation. learn extra

Nonetheless, Petro’s feedback adopted a report by the federal government’s DANE statistics company on Wednesday, which revealed that inflation in September rose 0.93% – with meals costs rising 1.61% – taking 12-month inflation to 11.44%.

“Meals costs proceed to drive the rhythm of inflation in Colombia; this time much less on account of worldwide inflation, extra due to flooding … Is it helpful to boost the rate of interest to comprise inflation?: No,” the president stated in a message on Twitter.

Not less than 5 former finance ministers criticized Petro, together with Juan Camilo Restrepo, who served below former President Andres Pastrana, and Mauricio Cardenas, who shaped a part of ex-President Juan Manuel Santos’ authorities.

“The markets take a dim view of a president firing photographs on the central financial institution, it takes away credibility of all of the nation’s financial establishments,” Restrepo instructed native media.

Petro is just not the primary president to disagree with the central financial institution’s choice, Colombia Threat Evaluation founder Sergio Guzman instructed Reuters by way of WhatsApp, although including that the feedback characterize a degree of political danger for the longer term.

“Petro’s bark is worse than his chew. Though it is a dangerous sign, it isn’t unprecedented and he cannot actually enact vital modifications that will materially have an effect on the nation’s financial coverage,” Guzman stated.

Colombia’s peso closed down 0.68% at 4,613.50 versus the greenback, one thing stockbrokers attributed to Petro’s feedback on the central financial institution’s charge choice, in addition to different feedback by the president regarding a doable tax to sort out so-called “swallow capital” that strikes swiftly from place to put to reap the benefits of banking and financial programs.

Reporting by Luis Jaime Acosta
Writing by Oliver Griffin; Enhancing by David Gregorio

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