BCRP raises the benchmark interest rate to 7.75%

The Board of Directors of the Central Reserve Bank of Peru (BCRP) approved on Thursday to raise the benchmark interest rate by 25 basis points to 7.75%, in accordance with adjustments in the monetary policy setting made in recent months.

The central bank stated, in a statement, that this decision was taken taking into account that the 12-month inflation rate in Peru rose to 8.46% last December due to the rise in food prices produced in the country.

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It also noted that the 12-month rate of inflation, excluding food and energy, fell to 5.59% in December, although “both indicators were above the upper end of the inflation target range” of 3%.

In the same sense, the Bank indicated that the significant increase in international energy and food prices, which was exacerbated by international conflicts, led to a sharp increase in inflation rates globally “by amounts not seen” for many years. And towards levels “significantly” above central banks’ inflation targets.

BCRP Perspectives

The bank expects a downward trend in inflation rates on an annual basis, starting next March, with a return to the target range in the fourth quarter of this year due to “the moderation of the impact of global food and energy prices” and a decrease in inflation rates. in inflation expectations.

In contrast, the 12-month inflation forecast was lowered to 4.30% in December, above the upper end of the target range for inflation.

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The source bank explained that most of the leading indicators and expectations about the economy recovered in December, although they are still “in a pessimistic range.”

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In the same vein, the growth prospects for global economic activity “are declining due to the effects of restrictive monetary policy in advanced economies,” the impact of inflation on consumption, and international conflicts.

The Board of Directors of the Bahrain Inflation and Reconstruction Bank affirmed its commitment to adopting the necessary measures to ensure that inflation returns to the target range on the projection horizon.

The bank also approved, in Thursday’s session, an annual rate of 5.25% for night deposits, in the financial system operations of the window system, as well as 8.25% for the first ten reporting operations of securities and currency, in the past three months.

Overnight Deposits is a monetary regulation tool that allows financial institutions to make deposits in national and foreign currency at BBK.


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