LIMA -- Peru's central bank left the monetary policy rate unchanged at 3.25% in Thursday’s monetary policy meeting, in line with market expectations.
In its statement, the central bank reiterated its message that the current level of the policy rate is consistent with the convergence of inflation to the 2.0% target in the 2015-2016 forecast horizon and that inflation expectations remain anchored within the central bank’s 1.0%-3.0% target range.
The central bank also kept its sentence that it will watch the behavior of inflation and its determinants to assess, if needed, changes in its monetary policy instruments.
The bank made slight adjustments in its tone regarding short-term inflation and economic activity. It mentioned that temporary factors affecting headline inflation have been dissipating at a slower-than–anticipated pace.
Regarding economic activity, it did not mention, as in the past, that the economic cycle continued to look weak, but instead simply said that it was growing below potential.
Analysts expect the central bank to leave the policy rate unchanged for the remainder of the year given high inflation, a weakening currency, and hints of a recovery in economic activity.