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BOGOTA, Oct 30 (Reuters) - Colombia's central bank may raise its benchmark lending rate for a second straight month on Friday even while the economy slows as policymakers try to rein in inflation that is already well above the bank's target range.
Fifteen of 18 analysts in a Reuters survey this week said the seven member bank board would raise the rate 25 points from 4.75 percent, while one predicted a rise of 50 points and two others forecast a hold.
Analysts project year-end inflation could reach 5.75 percent, worryingly above the bank's target range of 2 percent to 4 percent.
"A raise would more than anything be about containing inflation expectations because now there is some alarm about a possible de-anchoring," said analysts Julia Paez of Casa de Bolsa brokerage. "Even though raising the rate won't considerably lower expectations, it will contain them."
Although inflation pressure may ease somewhat next year, analysts predict consumer prices will still be high, close to the upper level of the bank's target range at around 3.76 percent.
Though the majority of the bank's board has said inflation increases are largely due to transitory factors like the El Nino drought and the depreciation of the peso currency, board member Carlos Cano has said there may be demand pressures.
Latin America's fourth-largest economy is also facing a growth slowdown that has led the government to reduce expansion projections to 3.3 percent from 3.6 percent.
The board will also take a good look at the decision this week by the U.S. Federal Reserve to hold interest rates and gauge how a possible December hike would impact local monetary policy. (Reporting by Nelson Bocanegra; Writing by Julia Symmes Cobb; Editing by Helen Murphy and Chizu Nomiyama)