- Decision
- Maintain
- Rate change
- 0 bps
- reference interest rate
- 4.75%
The Board of the Central Reserve Bank of Peru (BCRP) kept the policy rate at 4.75 percent in its February Monetary Programme, judging that inflation is close to target and economic activity is near potential while vowing that any further moves will hinge on new inflation data and its drivers. The pause follows a 25 bp cut in January that brought the rate to its estimated neutral level. The overnight deposit facility was left at 2.75 percent and repo/monetary-regulation credit operations remain at 5.25 percent for the first 10 operations in the past three months, with scope for higher rates on additional transactions. Headline inflation slipped to –0.09 percent m/m in January, pulling annual inflation down to 1.9 percent (from 2.0 percent in December) and core inflation to 2.4 percent, while 12-month inflation expectations eased to 2.37 percent, all within the 1–3 percent target band; forward guidance projects year-ahead inflation drifting toward the band’s lower bound before returning to the midpoint as supply shocks fade. Business sentiment indicators improved in January and continue to signal optimism amid firmer recent growth. Externally, the BCRP expects global inflation to keep moderating alongside a gradual normalisation of advanced-economy policy, although it warns of lingering risks from trade policy uncertainty and international conflicts. The Board reiterated its commitment to adjust policy if required to keep inflation within the target range.
Rate evolution
Over the period, the Central Reserve Bank of Peru held the reference rate at 4.50% in July 2025, lowered it by 25 basis points to 4.25% in September 2025 after several months on hold, and kept it unchanged through September 2026. The early pause reflected headline inflation and inflation without food and energy of 1.7% in June 2025, one-year-ahead inflation expectations of 2.3% within the target range, and activity around potential, while the September cut followed a temporary fall in headline inflation and the Board’s assessment that the rate was close to neutral.
At its June 11, 2026 meeting, the Board held the reference rate at 4.25%, noting that annual headline inflation eased to 3.9% in May, and on July 9 it again left the rate unchanged as headline inflation rose to 4.0% in June and inflation without food and energy to 4.5%, while expectations fell to 2.8% and activity indicators continued to perform well. In August, the Board maintained the rate as annual headline inflation increased to 4.1% in July, inflation without food and energy reached 4.6%, and 12-month inflation expectations rose to 3.0%, the upper limit of the target range. On September 10, it again held the rate at 4.25% as annual headline inflation rose to 4.4% in August, mainly because of a base effect, while inflation without food and energy declined to 4.5% and 12-month expectations increased to 3.1%, slightly above the target range. The Board projected both inflation measures would return to the target range and settle around 2% as supply-shock effects dissipated, but flagged risks from a more persistent El Niño and Middle East tensions and said it remained attentive to inflation, expectations, activity and the duration of supply shocks.