Peru: Central Bank holds interest rate at 4.25% in October
October 13, 2016
The Central Bank decided to maintain the reference rate at 4.25% for the eighth consecutive month at its 13 October monetary policy meeting, in line with market expectations.
According to the Central Bank, inflation expectations continued to decline gradually and inflation in July, August and September was very close to the Bank’s upper limit target of 3.0%. In the same months, upward pressures on inflation exerted by the rise in prices for food and services as well as the development of the exchange rate (USD-PEN) eased.
The Central Bank commented that the global economy continues to send mixed recovery signals in employment and production levels, while volatility in the global financial markets has cooled down. Moreover, the Bank reported that Peru’s economic growth remains close to its potential. Based on this assessment, the Bank considered it appropriate to maintain the reference rate. The next monetary policy meeting is scheduled for 10 November.