Aval Asset Management: a minimum wage hike well above 8% would complicate lowering inflation in 2027
Juan David Ballén, director of Economic Research at Aval Asset Management, called a reference near 8% reasonable for the 2027 minimum wage, with inflation closing 2026 below 7% and productivity near 1%. He warned that a much larger increase would make it harder to reduce inflation, especially in services, would affect formal employment and pressure public finances, and could lead Banco de la República to keep rates high for longer. Annual inflation in October was 6.30%.
In 40 seconds
- Ballén sees around 8% as a reasonable reference for the 2027 minimum wage, with inflation below 7% at the end of 2026 and productivity near 1%.
- A much larger increase would make it harder to lower inflation, especially in services, where wages weigh on costs.
- It would also affect formal employment and public finances, and could delay Banco de la República rate cuts.
Read the full story at Blu Radio
IASummary generated by artificial intelligence from a story by Blu Radio. It may contain errors: the original source prevails.
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