Colombia’s peso bond yields fell the most in a week on speculation policy makers will lower borrowing costs today to buoy growth in the Andean nation.
The yield on the 9.25 percent peso-denominated debt due in May 2014 fell two basis points, or 0.02 percentage point, to 4.87 percent at 9:39 a.m. in Bogota, according to the central bank. That’s the biggest decline since Oct. 19.
“The latest data on industrial output and vehicle sales point to a decelerating economy,” said Daniel Escobar, the head analyst at Global Securities brokerage in Bogota.
Seven analysts in a Bloomberg survey, including Escobar, predict Banco de la Republica will cut the overnight lending rate a quarter percentage point to 4.5 percent. Twenty-eight expect the key rate will remain unchanged.
Rate decisions will depend on global growth and the domestic economy, Colombia’s central bank said in minutes of its Sept. 28 meeting that were published Oct. 12. Policy makers held the target lending rate at 4.75 percent after two cuts since June from 5.25 percent.
The peso dropped 0.1 percent to 1,819.69 per U.S. dollar, paring its rally this year to 6.5 percent. The currency has dropped 1.2 percent this week, the biggest decline since the period ended Aug. 17.
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