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Analysts Expect BCRP’s Gradual Easing Cycle To Continue This Week

PERU
  • Ahead of Thursday’s BCRP monetary policy meeting, most analysts (12 out of 13) within the latest Bloomberg survey believe that the central bank will continue with its gradual easing cycle, expecting another 25bp cut in the reference rate to 6.00%. Only one analyst expects the policy rate to be left unchanged.
  • The general view among analysts is that the declining interest rate differential with the Fed and recent upside surprise to CPI inflation gives BCRP little room to step up the pace of easing, following six consecutive 25bp moves. However, weak GDP growth and the further decline in inflation expectations still support the case for further gradual easing and another 25bp cut. We will publish a full preview of the upcoming meeting tomorrow.
  • In other news, Andina report that the government has declared a state of emergency in various locations across the country in order to assist regions affected by significantly heavy rainfall.

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