Perú Actividad económica June 2023

Perú: Central Bank stands pat in June; possible hikes ahead

At its 8 June meeting, the Central Bank of Peru kept its key policy interest rate unchanged at 7.75% for the fifth consecutive time.

The Bank decided to stand pat amid weaker economic dynamics and easing inflation. Headline inflation dipped to 7.9% in May from April’s 8.0%. Meanwhile, inflation expectations over the next 12 months fell to 4.21% in May from April’s 4.25% but remained well above the Bank’s target range of 1.0–3.0%.

That said, the Bank expects inflation to move close to the target range in the final stretch of this year amid lower international prices for food and energy, easing supply chain disruptions and decreasing inflation expectations. Our panelists see inflation ending the year above target. The Bank stated that June’s decision did not mean the end of the tightening cycle; it stands ready to resume hiking, depending on future inflation figures and the evolution of economic activity.

The next meeting is scheduled for 13 July.