- Decision
- Maintain
- Rate change
- 0 bps
- reference interest rate
- 4.75%
The Board of the Central Reserve Bank of Peru cut the reference rate by 25 bp to 4.50 percent on 8 May, saying the policy stance is now near neutral and that any further moves will hinge on incoming data as it monitors still-subdued inflation and activity near potential. After a 25 bp reduction in January that brought the rate to 4.75 percent and two pauses in February and March, the easing cycle has resumed. The overnight deposit rate was lowered to 2.50 percent, while security and currency repos and monetary-regulation loans will carry 5.00 percent for the first ten operations in the last three months, with higher rates possible for additional transactions. April headline inflation rose to 1.7 percent y/y from 1.3 percent in March on higher food prices, but core inflation held at 1.9 percent and 12-month inflation expectations stayed at 2.3 percent, all within the 1–3 percent target band; the central bank still sees both headline and core inflation converging toward the midpoint in coming months even as sentiment indicators softened slightly. The Board flagged a deteriorating global growth outlook and increased financial-market volatility amid escalating trade tensions, which could slow global disinflation. It reiterated vigilance over price dynamics and stands ready to adjust policy to keep inflation within target, with the next monetary policy review set for 12 June 2025.
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.