Another Peruvian Interest Rate Hike

April 8, 2022

At this month’s scheduled monetary review, the Central Reserve Bank of Peru lifted its policy interest rate by 50 basis points to 4.5%, its highest level since 2009. While the Fed only within the past month entertained the thought of raising interest rates by increments greater than 25 basis point (something not done in decades), officials at the BCRP have been methodically ramping the rate up by 50 basis points a shot since last September. They have now done eight such moves, and that string was preceded by an initial doubling of the rate to 0.50% last August. Peruvian CPI inflation more than doubled fromĀ  and in-target 2.6% in March 2021 to a 283-month high of 6.82% in March 2022. The target range of 1-3% isn’t expected to be restored until “between the second and the third quarter of next year,” according to today’s released statement.

Copyright 2022, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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