On the other hand, there’s a series of macro factors that can give us some positive view. And it is, number one, we see unemployment holding much better than what we expected initially and the positive note. We also see that the end of the cycle might be soon, because we’ve seen the Central Bank flattening down. We would expect to see changes in monetary policy closer to the end of this year. And then government execution of budget should help GDP perform better. If you might — I can’t give you numbers, but qualitatively in this first half, government execution of project has been a lag, but there’s a decisive action from the President that points into government execution of budgets increasing during the second half. So those are some elements that give us some comfort on an improvement in the cycle.
And as interest rates are able to come down due to monetary policy and also the distortions I mentioned when we went through the presentation that should give some support to an improvement in cost of risk. Very long explanation, but just to let you know how we think about it.
Operator: [Operator Instructions] Your next question is a follow-up from the line of Yuri Fernandes with JPMorgan.
Yuri Fernandes: It’s me again. Just on this topic on margins and lower rates. Can you just refresh the sensitivity for lower rates for Grupo Aval, like how much [Multiple Speakers] help you on margins.
Diego Fernando Solano Saravia: Yuri, that has become a real problem in Colombia, because we think that cost of funds detached in a very relevant manner with Central Bank rate since we had changes in the net stable funding ratio. The sort of distortion that we saw first quarter was up to 400 basis points. And as of last week, we were at around 500 basis points. We do expect that this portion to fade away around October and that has become actually a stronger driving force than what the Central Bank rate looks like. So we do expect that marginal cost falling. You have to bear in mind that time deposits are close to 48% of our deposits. So it’s very relevant what happens there, but that should be helping our margins in a very substantial way.
So summarizing, we look forward to an adjustment back to a less distorted price of time deposits due to an improvement in the overall interest rate environment and on the other hand, we also expect on top of that interest rate cuts by the end of this year.
Operator: There are no further questions at this time. Mr. Luis Carlos Sarmiento Gutierrez, I turn the call back over to you.
Luis Carlos Sarmiento Gutierrez: Thank you so much, Regina, and thank you all for joining our call today. We expect to see better financial times coming in the last quarter. And hopefully, we’ll return to the numbers that we’re accustomed to see. Thank you so much, and hope to see you again next time.
Operator: Thank you, ladies and gentlemen. This concludes today’s conference. Thank you for participating. You may now disconnect.
