Central Bank Preview - April 08 - 2300BST

Peru Central Bank – April 08 - 2300BST/1800ET

• The Peruvian Central Bank are expected to keep the reference rate unchanged at 0.25% and maintain their current forward guidance of stable rate for an extended period. All seven analysts surveyed expect the policy rate to remain unchanged at 0.25%.
• Since the March 11 meeting, economic activity printed marginally below estimates at -1.0% and March inflation rose above estimates to 0.84% m/m and 2.6% y/y. Annual core inflation rose 22bp to 1.79% y/y; but remains below the 2% target.
• USDPEN is roughly 3% lower from the prior meeting. Recent optimism surrounding a market friendly candidate reaching the June runoff has bolstered the sol. The bank will feel little pressure to act on policy.

Analyst views:

• Goldman Sachs - Expect the MPC to keep the policy rate at 0.25% and maintain the forward guidance of a stable rate for an extended period. Given that core inflation remains well below the demanding 2% target, the output gap is still expected to close only around late 2022, and the clear guidance of stable policy rate for an extended period, they expect the MPC to keep the rate at 0.25% through late 2021.
• ScotiaBank – Likely to continue the week's trend of sidelined central banks, holding the policy rate at 0.25% on Thursday. Inflation popped higher again in March to 2.6% y/y and is in the upper half of the central bank's target range of 1-3%. Their Lima-based economists forecast rate hikes in 2022.