Central Reserve Bank of Peru Keeps Rate at 4.25%

The Central Reserve Bank of Peru kept its key monetary policy reference rate steady at 4.25%.  The Bank said: "This decision takes into account the lower growth being recorded by some components of expenditure, the current international financial risks, and inflation's deviation from the target due mainly to transitory supply factors. Future adjustments in the reference interest rate will depend on the evolution of inflation and its determinants."

Peru's central bank also held the interest rate at 4.25% at its February meeting, while the bank last raised the monetary policy reference rate by 25 basis points to 4.25% in May last year.  Peru reported annual inflation of 4.2% in February, compared to 4.74% in December, up from 4.2% in October, up from 3.73% in September, 3.35% in August and July, and compared to 2.9% in June, 3.07% in May, 3.34% in April, and above the Bank's 1-3% inflation target.  

The Bank's next Monetary Policy meeting will be held on the 12th of April 2012.  The Peruvian Nuevo Sol (PEN) last traded around 2.67 against the US dollar, with the PEN gaining approx. 3% over the past year.

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