New Colombia finmin eyes inflation, strong peso

BOGOTA, March 8 (Reuters) - Colombia's new finance minister said on Thursday he would focus on tackling inflation, the appreciation of the local peso currency and stubborn unemployment as he assumed his new government post.

Colombia's economy is expected to have grown around 7 percent in 2006, its best expansion in three decades driven by high foreign investment and domestic consumption. But analysts are concerned about inflation, joblessness and the currency.

"We have a problem as you saw with the results of inflation in the month of February, which we are worried about," Finance Minister Oscar Ivan Zuluaga told reporters.

Zuluaga provided no details about the measures the government planned to adopt to slow the rise in consumer prices and the revaluation of the peso as the economy grows a full throttle. Joblessness reached 14.4 percent in January.

In February, domestic demand appeared to the pressuring inflation, which registered at 1.17 percent for the month. That was well above forecasts by analysts.

Colombia's central bank says its target of 3.5 percent to 4.5 percent inflation for 2007 is not at risk, but February's high rate has worried some investors.

The appreciation of the peso has obliged the Central Bank to buy dollars in the market, purchases estimated at $2 billion in the first two months of this year. The central bank has also hiked its key interest rate in an attempt to curb inflation.