The Central Reserve Bank of Peru (BCRP) clarified that, if the law that allows the extraordinary withdrawal of up to S / 18,400 (4 UIT) to all members of the Pension Fund Administrators (AFP) is enacted, the impact it would have on inflation would be very moderate.
Adrián Armas, central manager of Economic Studies of the BCRP, explained that the impact would be limited, since the largest disbursement of pension savings occurred previously with the previous withdrawals authorized by Congress and the Executive. “We do not have an estimate, but we think that there would be a very moderate effect on the issue of inflation,” Armas said during the presentation of the Monetary Program for May 2022.
Another aspect that the official considers is that the scenario is different from that of previous withdrawals, since there is a labor market in recovery and it is very likely that the affiliates who seek to withdraw their funds are those who have not yet returned to formal employment.
However, Armas specified that the effect would be more due to the interest rates of the Peruvian sovereign bond, since its main claimant are the AFPs, and if a new withdrawal takes place, they would have to sell their liquid assets to comply with the disbursements requested by their affiliates. . In addition, it would impact the financial cost of long-term loans.
“Yes, it has generated other problems, especially in long-term interest rates and that affects the interest rate of long-term loans such as mortgages, there we could see a greater effect, not so much we believe in the case of inflation,” he said.
It is important to mention that the President of the Republic, peter castlehas until next May 27 to observe or promulgate the law that authorizes the withdrawal of funds from the AFPs.
Government sources indicated to this medium that the Ministry of Economy and Finance (MEF) has suggested that it be observed, however, The president still does not have a defined position.
Regarding the losses that have been dragging the funds of the affiliates managed by the AFPs and the profitability in red of fund 1 in the last five months, the BCRP official explained that this is due to the international crisis that has generated an increase in rates of interest and fall in the price of shares and sovereign bonds.
“All this has contributed to the fall in the value of the funds of the AFP and, in general, that is a drop in portfolios worldwide”, he concluded.
Adrián Armas, Central Manager of Economic Studies of the BCRP
“The effect is going to be less than it was before because there was already a significant withdrawal of families. The effect that this withdrawal of funds may have on consumption is quite marginal”.