The Central Reserve Bank of Peru (BCRP) held its reference rate at 4.25% in September, citing expectations that inflation will return to target alongside continued strength in leading activity indicators, while supply-shock risks persist. After cutting the rate to 4.25% in September 2025, the BCRP has held it at that level. The central bank maintained its overnight deposit rate at 2.25% and the rate on the first 10 direct repo and monetary regulation credit operations over three months at 4.75%. Annual inflation rose to 4.4% in August, while inflation excluding food and energy eased to 4.5%, and 12-month inflation expectations increased to 3.1%, slightly above the target range’s upper limit. The BCRP projects both inflation measures will return to the target range and settle around 2% as supply shocks fade, although El Niño and Middle East tensions could have more persistent effects. Leading indicators through August remained strong, with current-condition measures improving and expectations staying optimistic despite some moderation. Global risks remain elevated amid financial-market and oil-price volatility and geopolitical and trade uncertainty, although the world growth outlook remains positive and Peru’s terms of trade remain favorable. The BCRP said it is monitoring inflation, expectations, activity and the duration of supply shocks to make short-term adjustments to the monetary policy stance and ensure inflation returns to target.
2026-09-10Central Bank of Peru
Central Reserve Bank of Peru Holds Reference Rate at 4.25%
The Central Reserve Bank of Peru held its reference rate at 4.25%, citing expectations that inflation will return to target and continued strength in leading activity indicators despite persistent supply-shock risks. Annual inflation rose to 4.4% in August, while 12-month inflation expectations increased to 3.1%, slightly above the target range.