Peru raises rate 3rd time but keeps easy policy stance

October 8, 2021

By CentralBankNews.info.com   

Peru’s central bank raised its interest rate for the 3rd time this year but said it would still maintain an expansionary monetary policy stance for a “prolonged period” as the withdrawal of monetary stimulus will be “gradual.”
   The Central Reserve Bank of Peru (BCRP) raised its reference rate by a further 0.50 percentage point to 1.50 percent, its third rate hike since August, with the rate now raised by 1.25 percentage point.
   BCRP said it would continue to carry out all necessary actions to sustain the flow of payments and credit through the economy, and today’s rate hike does not imply successive rate hike.
   However, it also said financial markets had been volatile amid uncertainty and the actions by BCRP were aimed at easing these volatiles.
    Peru’s inflation rate rose for the 5th straight month in September to 5.23 percent from 4.95 percent in August – above the bank’s target range of 2.0 percent, plus/minus 1 percentage point.
   BCRP said it expected inflation to the return to its target range over the next 12 months and then remain in the range for the rest of 2022 due to the reversal of transitory factors, such as the exchange rate for the USD and international prices, while

www.CentralBankNews.info.com

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