decided to continue its expansionary policy stance, maintaining the reference rate at 0.25% and implementing liquidity injection operations, in light of the following developments:
Furthermore,
inflation is expected to remain within the target range throughout 2021 and 2022; and to lie at the lower part of the range during 2022, as economic activity will remain below its potential level.
Besides, one-year-ahead expected inflation was 2.4% in May. Additionally, most leading indicators improved in the fifth month of the year.
Global economic recovery is also expected to be more pronounced in the next quarters, as the vaccination process continues around the world, and significant stimulus packages are implemented in developed countries.
The Board considers it appropriate to maintain a strong expansionary monetary stance as long as the negative effects of the pandemic on inflation and its determinants persist.
Within this framework, the BCR will continue to take the necessary steps to sustain the payments system and credit flows, and stands ready to expand monetary stimulus using a range of instruments.
Financial markets were highly volatile in a context of electoral uncertainty and the BCR's actions were intended to mitigate this volatility.
As of June 9, BCR injection operations totaled S/56.670 billion (US$14.516 billion), of which S/48.870 billion (US$12.518 billion) was associated with government-backed repos.