President Gustavo Petro issued harsh criticism of the board of directors of the Colombia’s Central Bank, the country’s monetary authority, over its decision yesterday to keep the interest rate unchanged at 9.5%, where it has remained since December of last year.
In a lengthy and strongly worded message on his social media platforms, Petro described the decision as “unacceptable” and claimed it was driven by “exclusively political” motives. The president argued that high interest rates hinder Colombia’s economic growth by denying many citizens and businesses access to credit.
Petro Sees political motives in decision not to lower interest rates
The Central Bank’s board meeting, held yesterday, Monday, March 31, had been highly anticipated. The recent addition of two new board members had shifted the composition to one more favorable to the government.
With this change, it was expected the board would lower the interest rate by 25 to 50 basis points, bringing it down to between 9% and 9.25%. However, the surprise came in the early afternoon when Leonardo Villar, the Central Bank’s manager since 2021, announced the rate would remain unchanged.
The vote was close, with prudence prevailing by a single-vote margin. The government’s displeasure was immediate. After months of pushing for steeper cuts, keeping the rate at 9.50% for the fourth consecutive month—according to the government—obstructs Colombia’s economic growth.
In fact, President Petro disputed that the decision aims to curb inflation, as Villar justified, but rather to suppress the country’s growth within this range. He did not hesitate to direct sharp criticism at the central bank’s board members.
“While unemployment is falling sharply and job occupancy is rising rapidly, the Bank of the Republic’s board of directors, for exclusively political reasons, is seeking to stifle economic growth,” the president stated.
Petro further insisted that the previous month’s inflation rate remained stagnant (it actually rose 0.1% to 5.3%) due to a “surge in artificially driven speculation over residential gas prices.”
The president accused the conservative opposition of obstructing the country’s economic recovery. “The government is on the right track with its economic policy, but ‘Uribismo’ [referring to followers of former President Alvaro Uribe] is trying to block economic success by any means necessary, using its majority on the Central Bank’s board of directors,” he asserted.
Mientras cae profundamente el desempleo laboral y aumenta rápidamente la ocupación laboral; la junta directiva del Banco de la República, por razones exclusivamente políticas, busca contener el crecimiento económico; no para frenar la inflación, que el mes pasado se mantuvo…
— Gustavo Petro (@petrogustavo) March 31, 2025
Petro criticized his former Minister of Finance, Jose Antonio Ocampo
However, President Petro’s criticisms were not limited to the opposition and the alleged control over the Central Bank’s decisions. The president also emphasized the challenges facing public finances.
“The problem began earlier, and it is not a drop in tax revenue… This is due to measures taken in 2023—disastrous ones that were not reported to the president,” he said unexpectedly, directly referencing his former Finance Minister from that year.
Indeed, this accusation was a clear reference to former Finance Minister Jose Antonio Ocampo (2022–2023), whom Petro called on to clarify decisions that, according to the president, have undermined his administration’s capabilities.
“Former Minister Ocampo, doesn’t keeping the economy’s real interest rate high aim to defund the Colombian government by increasing internal debt? How afraid they are that the government will boost production and wealth,” Petro declared.
The president suggested these policies negatively impact social programs approved by citizens, while resources are diverted to projects and funds that benefit certain private sectors.
On this issue, Petro expressed regret over past decisions, such as the 2023 advance tax payments directed at subsidizing fossil fuels, which he argued have hindered goals to transition toward a decarbonized economy.