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    Colombia’s jobless rate rises to 8%, up from 7%

    by VT Markets
    /
    Jan 30, 2026
    Colombia’s national unemployment rate rose to 8% in December, up from 7%. This change highlights the economic struggles the country is facing. Economists are closely monitoring the labor market data. They are watching how this affects the economy and what actions policymakers will take in response.

    Implications of Rising Unemployment

    The jump in Colombia’s unemployment to 8% in December 2025 signals that the economy is slowing down. We can expect this to weaken the Colombian Peso (COP) compared to the US dollar. Traders might consider buying USD/COP call options to benefit from this potential decline. This disappointing labor data may prompt the Banco de la República to cut interest rates more aggressively. They already lowered rates twice in the last quarter of 2025 as inflation dropped from 9% to 7.5%. This new jobs report gives them greater flexibility. Investors should think about interest rate swaps that predict lower rates in the months ahead. The outlook for Colombian stocks, especially the MSCI COLCAP Index, has become more negative. Slower economic activity tends to hurt corporate profits. This view is backed by international banks downgrading Colombia’s 2026 GDP growth forecast to 1.9%. A wise approach now would include buying put options on the COLCAP index or selling its futures contracts.

    Strategies for Market Volatility

    Increased economic uncertainty is likely to raise market volatility in the short term. During the spike in unemployment in early 2020, the peso fell by over 15% in the following three months. This suggests that strategies like long straddles on the USD/COP pair, which profit from significant price changes, could be effective. Create your live VT Markets account and start trading now.

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