Peru Rate Hike Expectations Fueled by Inflation

Peru’s Central Bank was expected to increase its reference rate by 25bp to 6.25% last night following its monetary policy meeting, according to Credit Suisse. Although headline and non-food inflation increased slightly in July, the tightening at monetary policy is aimed at curbing domestic demand growth and at preventing second-round effects from food and fuel inflation, CS adds. In its last meeting, the bank increased its interested to 5.75% to 6%.