The Board of Directors of the Central Reserve Bank of Peru (BCRP) kept the reference rate at 4.25 percent on 14 May 2026, judging that the rise in headline inflation to 4.0 percent y/y and core inflation to 4.4 percent—both above the 1–3 percent target band—reflects temporary supply shocks linked to higher local transport and fuel costs, with both measures still projected to return to the target and stabilise around 2 percent in 2027. Following two 25 bp cuts in May and September 2025 that lowered the rate by a cumulative 50 bp to its current level, policy has remained unchanged. The central bank also left the supporting corridor intact, holding the overnight deposit rate at 2.25 percent and the rate on the first 10 repo or rediscount operations at 4.75 percent. One-year-ahead inflation expectations ticked up to 2.8 percent in April but stay within the target range, while leading indicators point to sound economic activity despite some softening in expectations. Externally, policymakers flagged elevated global risk from the Middle East conflict, which is keeping oil prices high, although global growth prospects and Peru’s terms of trade remain favourable. The Board reiterated its readiness to adjust policy if incoming data on inflation, expectations, activity or the persistence of supply shocks warrants action to secure inflation’s return to target.
Central Bank of Peru 2026-05-14
Central Reserve Bank of Peru keeps reference rate unchanged at 4.25%
Peru’s Central Reserve Bank kept the policy rate at 4.25 % on 14 May, citing temporary fuel- and transport-driven supply shocks that pushed April headline and core inflation to 4.0 % and 4.4 % y/y, above the 1–3 % target but still expected to recede to 2 % in 2027. The overnight deposit and repo/rediscount rates were left at 2.25 % and 4.75 %, with the Board pledging readiness to adjust if inflation, expectations or activity trends warrant.