LPEM COMMENTARY BI BOARD OF GOVERNORS’ MEETING DECEMBER 2016

After cutting rate six times in 2016, BI may need to maintain the benchmark rate at 4.75% (y.o.y.) on Thursday meeting. Even with slowing GDP growth of 5.02% (y.o.y.) in Q3 2016 and still-below-target inflation, several key external pressures, particularly with imminent December Fed rate hike and surprisingly promising lead on OPEC pledge to cut oil production, limit the room for easing until at least early 2017.

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