Interest rates in Peru were left unchanged last night and a subtle shift in language in the statement accompanying the decision suggests that policymakers appear to have closed the door to further rate cuts. Inflation is likely to remain close to the upper-bound of the central bank’s target range over the coming months, while recent currency weakness is likely to have played a part in their decision too. Accordingly, we expect rates to remain unchanged this year and have pencilled in modest hikes in 2016.
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