Central Reserve Bank of Peru Leaves Key Interest Rate Unchanged at 4.25%

October 11, 2013

The last Peruvian interest rate change by the BCRP was a 25-basis point hike on May 12, 2011 that capped a 10-step, 300 basis point tightening begun in May 2010.  Reserve requirements had earlier been cut in three straight months.

In a statement released yesterday, monetary officials explained their latest decision:

This decision is based on the following factors: i) economic growth in the country is close to the economy’s potential level of growth; ii) inflation expectations remain anchored within the target range; iii) the supply factors that affected inflation are reversing, and iv) international financial conditions are still uncertain, even though recent indicators of global activity show some recovery.

CPI inflation is marginally below the 1-3% target ceiling, and officials recently revised projected 2013 GDP growth down to 5.5%.

Copyright 2013, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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