Heteronomics Archive

November 07, 2024

Peru: 25bp Rate Cut To 5.0% (Consensus 5.0%) in Nov-24

The Central Reserve Bank of Peru reduced its reference rate by 25 basis points to 5.00%, in line with consensus expectations, while declaring the real interest rate as close to neutral.
October inflation data showed minor changes, with year-on-year headline inflation rising to 2.0% and core inflation falling to 2.5%. Although it expects inflation to stay within the target, there may be a temporary uptick due to base effects.
Future rate decisions will remain data-driven, with the BCRP monitoring inflation determinants and external economic risks such as global market volatility, geopolitical issues, and China's growth uncertainties.

October 10, 2024

The Central Reserve Bank of Peru’s decision to hold the rate at 5.25% surprised markets expecting a 25bp cut, signalling a more hawkish stance driven by moderating inflation trends and anchored expectations.
Inflation has declined, with headline inflation at 1.8% and core inflation at 2.6%, but a temporary rise is expected in Q4, underscoring the BCRP’s focus on inflation data to guide future rate decisions.
The BCRP’s future policy path will depend on inflation dynamics and global risks, with volatility in international markets and geopolitical concerns, such as rising fuel prices, playing critical roles in determining rate adjustments.

August 08, 2024

The BCRP unexpectedly reduced the policy rate to 5.5%, diverging from the consensus forecast for no change, reflecting its proactive stance amid favourable inflation dynamics and optimistic economic indicators.
Future policy decisions will be informed by ongoing assessments of inflation trends, core inflation persistence, and economic activity, ensuring a responsive and adaptive monetary policy approach.
The BCRP remains committed to maintaining inflation within the target range while fostering economic growth, acknowledging potential risks from global economic uncertainties and international conflicts.

July 11, 2024

The BCRP maintained its policy rate at 5.75% again, aligning with consensus expectations, reflecting a cautious approach amid persistent core inflation and a stable overall inflation outlook.
Future rate adjustments will be based on continuous monitoring of inflation trends, core inflation persistence, and economic indicators, ensuring a responsive and flexible monetary policy.
The Board remains committed to maintaining inflation within the target range, emphasizing price stability amid global economic uncertainties and potential market volatilities.