Colombia Inflation Rate Hits Lowest Level Since 2021

Colombia’s inflation rate fell to 5.05% in May 2025, the lowest since 2021. Driven by lower inflation in sectors like transportation and housing, it moderately exceeded market expectations. Yet, there was a slight increase in food and health prices.

Colombia’s annual inflation rate for May 2025 has dropped to 5.05%, which is a decrease from 5.16% recorded in April. This figure is encouragingly lower than the market’s expectations of 5.1%, marking the slowest inflationsince October 2021. Analysts are cautiously optimistic, noting that these numbers indicate a hard-fought progress in managing price increases across the country.

Key sectors saw a noticeable easing in inflation rates, particularly in transportation, which shifted to 5.26% from 5.29%. Housing followed suit, decreasing to 5.82% compared to 6.09%. Other areas like restaurants and hotels and education also reported positive movement, going from 7.71% to 7.41% and 7.38% to 7.35% respectively. This general trend suggests ongoing efforts to mitigate the escalating costs that have burdened consumers.

Conversely, there was a slight uptick in the inflation rates of food and health services. Food inflation went up to 4.71%, compared to the prior 4.61%, while health inflation increased to 5.34%, up from 5.31%. Such rises in staple goods may elicit concern among economists about the broader implications for household budgets.

On the monthly front, consumer prices rose by just 0.32%, which is lower than the expected increase of 0.5%. This rise marks the smallest monthly change since November, down from April’s 0.66%. This signifies a possible stabilization in consumer costs after several months of volatility.

In summary, Colombia’s inflation rate has shown significant improvement, falling to its lowest level since 2021 at 5.05%. The decline is driven primarily by reduced inflation in essential categories. However, the increase in food and health costs raises some concerns. Overall, the figures suggest a positive trend towards economic stabilization, although vigilance remains essential in certain sectors.

Original Source: www.tradingview.com