Peruvian Central Bank Interest Rate Kept at 4.25%

April 15, 2016

Four previous 25-basis point rate increases were implemented last September, December, January and February in response to inflation considerably above the 1-3% target.  April’s was the second straight monthly meeting not to tighten further, and a statement released by monetary officials at the Central Reserve Bank of Peru noted that total and core inflation fell further in March and that expected inflation appears to be easing as well.  A strengthening Peruvian sol is helping, as are lower food prices.  Growth is hovering near 5% and in line with the estimated expansion rate of potential GDP.  Inflation presumably needs to keep decelerating toward target to forestall additional interest rate hikes.

Copyright 2016, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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