Eseandre Mordi
Colombia's inflation picture is still running hotter than policymakers would like, and the chart makes the message unusually direct. As Steve Hanke noted, Colombia's March inflation rate came in at 5.6% year over year - above the 3% target - while official M3 money supply growth reached 12.1% versus his 9.3% Golden Growth Rate benchmark. That leaves the latest M3 reading clearly above the blue benchmark line, reinforcing the core argument that excess money growth is still inconsistent with a return to target inflation.
The Colombia M3 Line That Has Moved Back Above Benchmark
The visual structure is straightforward. Colombia's M3 growth rate moved through several cycles between 2020 and 2026, but the latest reading climbs back above the 9.3% benchmark line. The chart explicitly labels March 2026 official M3 growth at 12.1% per year while the Golden Growth Rate remains fixed at 9.3% - and that gap is the central feature of the image.
Colombia Inflation Stays at 5.35% as Money Supply Growth Hits 10.9% captured the earlier stage of this same dynamic, showing how the M3-versus-benchmark gap has been persistent rather than new - making the March 2026 reading a continuation of a pattern rather than a surprise reversal.
A Familiar Pattern in Colombia's Money Data
The longer history in the chart matters because it shows this is not Colombia's first swing above the benchmark. Money supply growth surged far above the target-consistent line in 2020, cooled sharply in 2021, accelerated again in 2022, then spent much of 2023 and 2024 below or near the benchmark before turning higher again into 2025 and 2026.
The latest move is not an isolated spike - it looks more like a renewed upswing in monetary growth after a period of relative moderation. If money supply growth is again running materially above the level associated with 3% inflation, price pressure may remain sticky rather than quickly falling back to target.
The Broader Theme Behind Colombia's Monetary Signal
This money-supply-versus-inflation framework is not unique to Colombia. Similar dynamics have recently appeared across emerging markets. Turkey M3 Money Supply Surges to 39.9% as CPI Hits 31.5% shows the more extreme version of the same relationship - where M3 running persistently above benchmark levels has kept inflation structurally elevated regardless of nominal policy adjustments.
Nigeria Inflation Holds at 15.06% as M3 Money Supply Growth Falls Below 20.33% Benchmark provides the counterpoint - showing what the beginning of inflation normalization looks like when M3 growth finally falls back below the benchmark level, which is precisely what Colombia has not yet achieved.
Eseandre Mordi
