Peru: Inflation accelerates in April from the prior month
Latest reading: Consumer prices in Lima rose 4.0% on a year-on-year basis in April, following a 3.8% increase in the previous month. April’s reading was the strongest since October 2023.
Relative to the prior month’s figures, there were higher price pressures for transport (+15.0% on a year-on-year basis vs +11.5% in March) and housing and utilities (-0.2% vs -0.4% in March). In contrast, price pressures reduced for food and beverages in April (+4.2% vs +5.4% in March). Finally, the changes in clothing and recreation and entertainment were the same as in the prior month (+1.4% and +1.8%, respectively).
Finally, consumer prices in Lima increased 0.52% in April on a month-on-month basis, following a 2.38% increase in the prior month.
Panelist insight: On their inflation forecasts and the implications for monetary policy, Itaú Unibanco analysts said: “Our year-end inflation forecast sits at 2.8%, with upside risks. For 2027, we continue to expect inflation to gradually converge toward the midpoint of the target range, as supply-side pressures fade. The BCRP’s well-deserved credibility should help keep medium-term inflation expectations anchored and bring about disinflation. With the policy rate at 4.25%, slightly above the BCRP’s estimated neutral rate of around 4%, amid rising inflationary pressures and still-favorable external conditions, the balance of risks appear increasingly tilted toward a potential rate hike.”