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MNI Peru Central Bank Review - June 2024: Unexpected Pause, Door Open to Further Easing

Executive Summary

  • Peru’s central bank kept its reference rate unchanged at 5.75%, against the majority of analysts expectations for a further 25bp cut.
  • The board continued to sound comfortable with the inflation outlook, but noted some persistence in core inflation, which along with recent exchange rate pressures may explain the pause.
  • The statement kept the door open to further easing ahead, with the usual caveat that “future reference rate adjustments will be conditional on new information about inflation and its determinants.”
  • Most analysts expect gradual rate cuts to continue in the coming meetings, with some additional pauses along the way.

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