Category: Regions
Posted inDaily Brief

Peru expected to hold rates

by LatinFinance

Analysts expect Peru’s central bank to hold rates at 4% when it meets today, although one says a rate cut is possible. The bank held rates in December after a surprise cut in November from 4.25%. Before that, rates had been stable for more than two years. Peru’s reported lower-than-expected inflation in December, bringing the annual rate to 2.86% for 2013, inside the central bank’s 1% to 3% target. That gives the central bank some freedom, says the analyst. The central bank revised down its 2013 GDP growth expectations, to 5.1%, from 5.5%, in December. The deceleration could spur a rate cut, but waiting would give the economy an opportunity to stabilize, the analyst said.

Posted inDaily Brief

Colombia base rate held at 3.25%

by LatinFinance

Colombia’s central banks held the country’s benchmark interest rate at 3.25% at its December meeting. The bank says it took into account better than expected signs of recovery in the global economy, as well as the US’s reduction in monetary stimulus. Colombian GDP growth was stronger than expected in the third quarter and inflation was lower than forecast.

Posted inDaily Brief

Moody’s Lowers Peruvian Retailer

by LatinFinance

Moody’s has downgraded Maestro Peru to Ba3 from Ba2, it says. The action is based on the home improvement retailer’s continued high leverage and increasingly pressured liquidity in 2013, as the company executes a “relatively aggressive” expansion plan. Same-store sales and overall Ebitda growth were weaker than expected. The agency finds Maestro’s 5.8x total debt-to-Ebitda level as high for its category. Supporting the rating are the favorable macroeconomic conditions in Peru, a robust housing market and increasing penetration of the larger retail chains in a highly fragmented market, Moody’s says. The outlook is negative. Maestro is now rated Ba3/B+.

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