(Bloomberg) -- Colombia’s economy lagged expectations in the third quarter as mining and manufacturing output contracted, bolstering President Gustavo Petro’s argument that deeper interest rate cuts are needed.
Gross domestic product expanded 2% in the three months to September from the same period a year earlier, the nation’s statistics agency said Monday. That compares to the 2.3% median estimate of analysts surveyed by Bloomberg.
Oil and mining activity contracted 7.1% from a year earlier, while manufacturing shrank 1.3%. Among the strongest sectors were agriculture and entertainment, including online gambling.
GDP grew 0.2% from the previous quarter.
President Gustavo Petro and his finance minister Ricardo Bonilla have repeatedly called for faster monetary easing to boost weak economic activity. The central bank has lowered its key rate by 3.5 percentage points to 9.75% over the past year, but has so far declined to do what the government wants and cut it in increments greater than half a percentage point.
The majority of policymakers aren’t confident that annual inflation, which slowed to 5.41% in October, will hit the 3% target next year.
Bibiana Taboada, a central bank board member, said in an interview last week that uncertainty about the government’s fiscal outlook demands caution from the central bank to avoid further volatility in the peso and bonds.