Peru: Inflation rises in October but remains moderate
Latest reading: Inflation inched up to 2.0% in October, following September’s 1.8% and in line with the Central Bank’s 1.0–3.0% target. The uptick was largely driven by a rebound in food prices.
Annual average inflation edged down to 2.6% in October (September: 2.8%).
Lastly, consumer prices dropped 0.09% over the previous month in October, a more moderate drop than the 0.24% drop recorded in September.
Outlook: Inflation has been within target for most of this year, which has allowed the Central Bank to successively cut the policy rate. Further rate cuts are likely going forward for this same reason.
Panelist insight: On the monetary policy and inflation outlook, BBVA analysts said:
“At BBVA Research we estimate that inflation will register a certain increase in the remainder of the fourth quarter due to an unfavorable year-on-year comparison base. Our current projection of 2.5% for the end of 2024 has, however, a downward bias (the prices of some foods still have some room to continue normalizing after the supply shocks of previous months have dissipated).This projection for total inflation […] suggests that the BCRP will soon resume the cycle of cuts in its monetary policy rate.”