Central Bank of Peru raises its interest rate to 4%; raises expectations for inflation to 3.75%

The Central Bank of Peru raised its interest rate to 4.0% from the previous 3.5%, its eighth consecutive advance, the agency said on Thursday, while pressures persist on inflation, which is well above the annual target range.

The rate of inflation to twelve months it stood at 6.15% in February due to the increase in international food and fuel prices and a higher exchange rate, more than double the annual target range of between 1% and 3% of the central bank.

Peru, the world’s second largest producer of copperclosed 2021 with an inflation of 6.43%, the highest rate in 13 years.

The central bank said that twelve-month inflation expectations have risen to 3.75% from 3.73%, while most indicators of expectations about the local economy continued in the pessimistic range in February.

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