UPDATE 1-Colombia cenbank ups lending rate to 5.5 pct, keeps CPI target
(Adds comment from analyst, bank statement)
BOGOTA Nov 27 (Reuters) - Colombia's central bank increased the benchmark interest rate by a quarter point on Friday in an effort to stem rising inflation that is already well above the bank's target range.
The seven-member board decided by majority to boost the lending rate to 5.50 percent, meeting the forecast of nine of 21 analysts in a Reuters survey. The bank maintained its inflation target at 2-4 percent with 3 percent as the ideal level.
The latest rate increase comes on top of 75 basis points it has raised over the previous two months.
"Inflation expectations have increased and the risk of a slowdown in domestic demand, beyond that consistent with the decline of national income, has slowed," the bank statement said.
"The acceleration of inflation so far this year is mainly explained by the transfer of the nominal depreciation (of the peso currency) to consumer prices and the increase in costs of imported raw materials, as well as less dynamic in the food supply."
November's annual inflation reached 5.89 percent. The bank said the most recent data showed inflation would be a bit above 4 percent in 2016.
Analysts have said the bank needs to play catch-up on easing inflation and should have boosted the rate sooner than its first quarter-point increase in September. Continuación...