Peru: Central Bank keeps interest rate unchanged
November 11, 2010
At its monetary policy meeting on 11 November, the Central Bank left its reference rate unchanged at 3.00% amid subdued inflationary pressures. The Bank's decision, which was broadly expected by private sector analysts, followed on an unexpected halt in monetary policy tightening in October, after the Bank had raised rates several times since May this year. Monetary authorities stated that their decision to pause raising rates for a second month took into account easing inflation pressure. While the Central Bank acknowledged that recent data confirmed the strong dynamism in domestic demand, forward-looking information points to a moderation in the pace of global economic growth in the months ahead. The Bank stated that inflation expectations remained ?anchored? to the tolerance range and that future decisions on movements in the reference rate will be based on macroeconomic developments. The next monetary meeting is scheduled for 9 December.
Author: Ricardo Aceves, Senior Economist