Peru keeps 4¼% reference rate with eye on economic activity slowdown

By Toni Weeks

San Diego, Sept. 9 - The Central Reserve Bank of Peru's board said it again decided to keep the monetary policy reference rate at 4¼%.

Inflation in August was affected by transitory factors and recorded a monthly rate of 0.27% and an annual rate of 3.35%, according to a bank news release on Friday.

Core inflation, which registered 0.25%, accumulated an annual growth rate of 3.19%. Inflation excluding food and energy was recorded at 0.13%, with an accumulated annual rate of 2.13%.

The board pointed out that a lower growth of global activity and increased uncertainty is still prevalent in international financial markets. Along with the weak evolution of the U.S. economy, these factors have a potential negative effect on global economic growth.

The board also maintained the overnight deposit rate at 3.45% and direct repo and rediscount operations rate at 5.05%.

The bank opted to hold steady on the policy rate at 4¼% in August.

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