In March, foreign investors increased their TES holdings by about COP3.3trn. Total holdings reached COP103.4trn – a new historical high. In percentage terms, foreigners’ holdings stood at 24.9% of the total outstanding. International investors and pension and retirement funds were the main buyers in the month while the MinFin was the largest seller. The TES curve managed to outperform other LatAm local curves; the average yield change was about 17bp in a rather parallel move with TES 27s and 28s outperforming. Expecting higher inflation prints, international investors also added positions in inflation-linked bonds, and we expect this to continue. Like other countries in LatAm, inflation remains a concern in Colombia. The latest prints have come at a higher level than the market consensus while the central bank has surprised investors with a smaller than expected rate hike. Nevertheless, the hiking cycle is likely to continue. The spike in oil prices that contributed to the good performance of the COP might have fuelled foreigners’ appetite for TES, outweighing concerns about the upcoming presidential election in the country.