The Central Reserve Bank of Peru (BCRP) agreed to raise the reference interest rate by 25 bps. at 7.50%, as part of its monetary policy adjustments and with the intention of attenuating inflation that is at the upper limit of the target range.
The twelve-month inflation rate increased from 8.28% in October to 8.45% in November, while the rate of inflation excluding food and energy at 12 months fell from 5.72% to 5.71%. Both indicators were above the upper limit of the inflation target range.
“Year inflation is projected to decline with a return to the target range in the fourth quarter of next year, due to the moderation of the effect of international food and energy prices, and a reduction in inflation expectations,” he said. the BCRP.
In addition, 12-month inflation expectations fell from 4.78% in October to 4.68% in November and for the year 2023 they stand at 4.40%, above the upper limit of the inflation target range. While most of the indicators and expectations about the economy remain in the pessimistic range.
Likewise, the prospects for growth of economic activity on a global scale have been declining due to the effects of the restrictive monetary policy in advanced economies, the impact of inflation on consumption, slower growth in China, and international conflicts.
“The Board of Directors is especially attentive to the new information referring to inflation and its determinants, including the evolution of inflation expectations and economic activity, to consider additional modifications in the monetary policy position,” the entity specified.
On January 12, 2023, the board of the BCRP will meet again to make decisions regarding monetary policy.
Source: Larepublica
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