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Colombia economy to grow more than 8.5%, finance minister says

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BOGOTA, Nov 5 (Reuters) – Colombia’s economy will expand more than 8.5% this year as the country rebounds from the coronavirus pandemic, the finance minister said early on Friday, and will have a deficit of less than 8.6%.

The increase in the gross domestic product growth estimate from a previous 6% puts the government prediction closer to the central bank’s outlook of 9.8% growth, which it increased for the second time running last week.

“We announce to the country that the economy of Colombia will grow above 8.5%, this is excellent news for the country because it means the process of reactivation is underway, which will allow us, from a fiscal perspective, to have a deficit below 8.6%,” Jose Manuel Restrepo said on Twitter.

The central bank board raised the benchmark interest rate by 50 basis points to 2.5% last week, accelerating rate increases meant to control well above-target inflation.

The board was once again divided on how sharply to increase the rate, with five policymakers backing a half-point uptick and the remaining two backing a quarter-point increase.

Colombia’s economy shrank a record 6.8% in 2020 because of lockdowns and restrictions meant to slow the spread of coronavirus. (Reporting by Julia Symmes Cobb Editing by Frances Kerry)

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