Peruvian Central Bank Policy Rate Held Steady at 4.25%

September 9, 2016

Seven months have now passed without the Central Reserve Bank of Peru changing its interest rate. Previously such was lifted five times in the space of 7 meetings from September 2015 to March 2016, each by 25 basis points. Such more than offset four cuts from November 2013 through January 2015. The Board released a statement identifying the following pertinent factors behind their decision in September:

  1. Expected inflation is receding gradually.
  2. The economy is likely to expand about 4% per year in 2016-17, more or less consistent with its potential.
  3. Business sentiment is upbeat.
  4. Factors that had lifted inflation related to food, utilities, and peso depreciation are now reversing.

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



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