Bloomberg reported that Peru’s central bank will probably keep its benchmark interest rate unchanged for an 8 month as the highest inflation rate since 2009 prevents policy makers from doing more to shore up economic growth.

Mr Pedro Tuesta an economist at 4Cast Inc said that Peru’s economy expanded at the slowest pace in 21 months in October as the European debt crisis weighed on commodity prices and worldwide demand. The central bank is likely to keep rates on hold as it waits to see if stagnation in Europe pushes growth in Peru’s commodity dependent economy still lower.

Mr Tuesta said that “Policy makers must be concerned about growing inflation expectations but they seem optimistic about a slowdown in prices this year. They won’t have space to cut unless there is an implosion in Europe.”
(Sourced from bloomberg.net)