Thursday, May 9, 2013

Peru holds rate steady, inflation still in target range

    Peru's central bank held its policy rate steady at 4.25 percent, as expected, saying inflation remains within the bank's target range and economic growth is close to potential, a phrase the central bank has often used in recent months.
    The Central Reserve Bank of Peru (BCRP), which has held rates steady since April 2011, said inflation was projected to converge to the midpoint of the bank's 1-3 percent target range over the next months due to improved food supply while production remains close to potential and inflation expectations are anchored around the target range.
     Peru's headline inflation rate eased to 2.3 percent in April, down from 2.6 percent while the core inflation rate was 3.4 percent. The central bank has forecast that inflation this year will be between 1.5 and 2.5 percent.
    Peru's economy has stabilized around its sustainable level although the sectors related to the external market continue remain weak, the BCRP added.
    Peru's Gross Domestic Product expanded by 0.6 percent in the fourth quarter from the third for annual growth of 5.9 percent, down from 6.8 percent.
    Last year Peru's economy grew by 6.3 percent, the fastest growth rate in Latin America, but down from 6.9 percent in 2011.

   www.CentralBankNews.info


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