By Javier Mozzo
BOGOTA, Sept 6 (Reuters) - Colombia has increased its 2011 economic growth goal to 4.5 percent from a previous 4 percent, Finance Minister Juan Carlos Echeverry said on Monday, predicting the expansion could reach as high as 5.5 percent.
'We have budgeted 4.5 percent but our projections go as high as 5.5 percent,' he told reporters.
The central government deficit is expected to be 4.1 percent of gross domestic product in 2011, up from a previously projected 3.9 percent.
President Juan Manuel Santos, sworn in for a four-year term last month, has ordered an increase in infrastructure projects aimed at supporting Colombia's agriculture sector. The government is also increasing investment in housing, mining and technology.
Santos and Echeverry say the spending is needed to drive growth and eventually end the Andean country's budget deficits.
Colombia will increase its auctions of local TES debt next year by about $1.1 billion over its original 2011 target to accommodate a planned increase in government spending, Echeverry said.
Colombia originally planned $8.85 billion in TES auctions for next year.
Earlier on Monday there were leaks in the market of higher-than-expected government indebtedness next year, driving local bond prices down. Yields on benchmark TES bonds due July 2020 rose after the news to 7.174 percent compared with Friday's close of 7.068 percent.
'It was a combined effect,' said Banco de Bogota Chief Economist Camilo Perez. 'Inflation came out higher than expected and, additionally, there is the announcement of the additional indebtedness in 2011.'
The government said on Saturday that inflation in August was 0.11 percent. The market had expected a rate of 0.04 percent.
Colombia will unfreeze 482,700 billion pesos in spending in 2010, but the move will not increase the country's expected central government deficit of 4.3 percent of GDP this year, Echeverry said.
(Reporting by Javier Mozzo; Editing by Kenneth Barry) Keywords: COLOMBIA GROWTH/ (javier.mozzo@thomsonreuters.com; tel 571-634-4139) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
BOGOTA, Sept 6 (Reuters) - Colombia has increased its 2011 economic growth goal to 4.5 percent from a previous 4 percent, Finance Minister Juan Carlos Echeverry said on Monday, predicting the expansion could reach as high as 5.5 percent.
'We have budgeted 4.5 percent but our projections go as high as 5.5 percent,' he told reporters.
The central government deficit is expected to be 4.1 percent of gross domestic product in 2011, up from a previously projected 3.9 percent.
President Juan Manuel Santos, sworn in for a four-year term last month, has ordered an increase in infrastructure projects aimed at supporting Colombia's agriculture sector. The government is also increasing investment in housing, mining and technology.
Santos and Echeverry say the spending is needed to drive growth and eventually end the Andean country's budget deficits.
Colombia will increase its auctions of local TES debt next year by about $1.1 billion over its original 2011 target to accommodate a planned increase in government spending, Echeverry said.
Colombia originally planned $8.85 billion in TES auctions for next year.
Earlier on Monday there were leaks in the market of higher-than-expected government indebtedness next year, driving local bond prices down. Yields on benchmark TES bonds due July 2020 rose after the news to 7.174 percent compared with Friday's close of 7.068 percent.
'It was a combined effect,' said Banco de Bogota Chief Economist Camilo Perez. 'Inflation came out higher than expected and, additionally, there is the announcement of the additional indebtedness in 2011.'
The government said on Saturday that inflation in August was 0.11 percent. The market had expected a rate of 0.04 percent.
Colombia will unfreeze 482,700 billion pesos in spending in 2010, but the move will not increase the country's expected central government deficit of 4.3 percent of GDP this year, Echeverry said.
(Reporting by Javier Mozzo; Editing by Kenneth Barry) Keywords: COLOMBIA GROWTH/ (javier.mozzo@thomsonreuters.com; tel 571-634-4139) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.