Peru November Consumer Prices Rose Less Than Estimated

Peruvian consumer prices rose less than economists estimated in November after two months of declines.

Prices rose 0.01 percent in November from October, the national statistics agency said today. Inflation was expected to have been 0.19 percent last month, according to the median estimate of 12 analysts surveyed by Bloomberg. Prices rose 2.22 percent from a year earlier, the agency said.

Prices for food and beverages fell 0.2 percent from October. Falling meat and vegetable costs offset rises for sugar, rice and bread as well as more expensive fuel and electricity, Renan Quispe, the agency’s director, told reporters in Lima today. November’s annual inflation rate was the lowest in Latin America, Quispe said.

“There won’t be any problems with inflation, at least for the rest of this year,” said Mario Guerrero, an economist at Scotiabank Peru, in a telephone interview from Lima. “The central bank will maintain the reference rate around 3 percent.”

The central bank has raised its benchmark lending rate five times this year and increased reserve requirements to prevent annual inflation from accelerating beyond its 1 percent to 3 percent target range.

Inflation Under Control

South America’s sixth-largest economy grew 9.5 percent in the third quarter as domestic demand fueled construction and retail activity. The growth rate may remain above 7 percent until the second quarter of next year, central bank President Julio Velarde said last week. Inflation will remain under control, he said.

The government’s consumer price index is based on a statistics agency survey of establishments in the Lima Metropolitan area. Food and drink costs account for 38 percent of the index.

Annual growth in agricultural and electricity output accelerated in October, the agency said in a separate report. Growth in cement demand slowed to 10.2 percent from a year earlier from 22 percent in September.

The sol gained 0.2 percent to 2.8265 per dollar at 12:48 p.m. in New York.

To contact the reporter on this story: John Quigley in Lima at jquigley8@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net

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