BCRP maintains the reference interest rate at 7.75% for the third consecutive month

He Central Reserve Bank of Peru (BCRP) reported this Thursday, April 13, that it will maintain the reference interest rate at 7.75%, which does not necessarily imply the end of the cycle of increases, the entity specified. Future adjustments in the reference rate will be conditional on new information on inflation and its determinants, including the macroeconomic effects of recent social events, they said.

“It is projected that year-on-year inflation will continue to decline in the coming months, with a return to the target range in the fourth quarter of this year.due to the moderation of the effect of international food and energy prices, the reversal of supply shocks in the agricultural sector and a reduction in inflation expectations for the rest of the year,” the entity said.

In making this decision, the BCRP took into account that in March the monthly inflation rate was 1.25% percent and inflation without food and energy was 0.88%. The twelve-month inflation rate fell from 8.65% in February to 8.40% in March. Despite the reductions, the indicator is still above the upper limit of the inflation target range.

In this session, it was also agreed to maintain the following interest rates for BCRP operations in national currency with the financial system under the over-the-counter modality:

• Overnight deposits: 5.25% per year.
• Direct repo operations of securities and currency, and Monetary Regulation Credits: i) 8.25% per annum for the first 10 operations in the last 3 months; and ii) the interest rate set by the Monetary and Exchange Operations Committee for additional operations to these 10 operations in the last 3 months. In addition, the Monetary and Exchange Operations Committee may establish higher rates based on the amount of the operations.

The next meeting where the monetary program will be evaluated was scheduled for Thursday, May 11.