The Central Reserve Bank of Peru (BCR) has recently approved to maintain the monetary policy interest rate at 3%.
This decision came after inflation in January continued declining and showed a rate in the lower band of the inflation target range for the third consecutive month.
Inflation is projected to remain around the lower band of the target range in the first months of 2018 and to converge thereafter to 2.0%.
Moreover, trend inflation measurements continue decreasing and are expected to remain close to the middle of the target range during this year.
Expectations of inflation in 12 months continued decreasing and registered a rate of 2.29% in January 2018.
Economic activity
"Economic activity continues to grow at levels below its potential level of growth," the BCR stated.
"The world economy continues to show positive indicators, with positive signals in the prices of commodities and in capital flows to the emerging economies, although uncertainty in international financial markets has increased," it added.
The BCR pays close attention to new data on inflation and inflation determinants to consider the convenience of making additional adjustments in the Central Bank’s monetary policy stance should it be necessary.
"Inflation in January showed a rate of 0.13%, as a result of which the year-to-year inflation rate fell from 1.36% in December to 1.25% in January. Inflation without food and energy recorded a rate of -0.13%, as a result of which the year-to-year rate fell from 2.15% in December to 1.97% in January, also within the target range," the bank said.
Finally, business expectation indicators improved in January and continue to be on the optimistic side.
(END) CNA/RMB
Published: 2/10/2018