The Central Bank of the Dominican Republic kept its Monetary Policy (Overnight) Rate unchanged at 6.75%, and held the Lombard Rate at 9.00%. The Bank said: “Domestically, economic activity and internal demand are moving as predicted by the latest Monetary Policy Report. Credit to the private sector is expanding at a rate similar to that corresponding to year-end 2011, while inflation expectations remain close to the 2012 target.”
The Bank also held rates unchanged at its previous meeting, and last raised the rate by 50 basis points in April, 25 basis points in March, and 100 basis points in February last year; the bank also reduced its Lombard Rate by 50bps to 9% in November last year.
The Bank said annual inflation was 6.9% in January, down from 7.8% in December, compared to 6.17% in January 2011, this compares to the inflation target of 5.5% +/- 1% for CPI during 2012 (adopted under the inflation targeting framework).
The Dominican Republic’s currency, the Dominican peso (DOP), weakened by about 3% against the US dollar over the past year, while the USDDOP exchange rate last traded around 39.
