Peru’s Central Bank Holds Interest Rate at 4.75% Amid Inflation Stabilization

Peru’s central bank kept its benchmark interest rate steady at 4.75% on Thursday, aligning with market expectations. The decision follows a gradual easing cycle since September 2023, when the rate peaked at 7.75%, making Peru one of Latin America's lowest-rate economies.

In its statement, the central bank cited expectations that annual inflation in March will approach the lower end of its 1%-3% target range before stabilizing near the midpoint. February’s inflation rate stood at 1.48%, already at the lower bound of the target, with monthly prices rising 0.19%.

Peru, the world’s third-largest copper producer, has been closely monitoring inflation trends. Core inflation, which excludes volatile items, is projected to hover around 2%, signaling relative stability in consumer prices.

The decision to maintain the rate suggests policymakers are balancing inflation control with economic growth, ensuring stable financial conditions while keeping borrowing costs low.