Santos urges central bank to lower interest rates to halt economic slowdown

Colombian president Juan Manuel Santos urged the country’s central bank to lower its interest rates in response to an economic slowdown.

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“I believe the central bank can continue reducing interest rates,” said Santos during a meeting with members of the Medellin textile industry. “They should meet next week for the first board meeting of [the] year and we’re going to ask the board to continue lowering interest [rates] to be able to…give additional stimulus to the economy.”

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The economic slowdown in Colombia has been attributed to a fall in overseas sales and a slumping manufacturing sector. Meanwhile, the country’s mining and oil sectors have been flooded with foreign investment leading some analysts to worry that the country might suffer from what economists call the “Dutch disease.” In addition to Dutch disease, the economy has suffered from a strong peso and amongst an uncertain global economy, the president and the finance minister have repeatedly asked for the central bank to lower interest rates and buy US dollars to bring down the strength of the country’s currency.

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Colombia has slashed rates at the last two central bank meetings and experts predict a similar result during the upcoming January 28 meeting.

The Santos administration on Tuesday also announced that they will issue a 10-year global bond in United States dollars. The Colombian government reportedly plans total overseas bonds sales for 2013 to be $2.6 billion.

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