Peruvian consumer prices rose faster than expected in April, keeping the annual inflation rate above 4 percent for a seventh straight month, amid higher food and fuel costs.
Prices rose 0.5 percent from March and gained 4.1 percent from the same month a year earlier, the national statistics agency said in an e-mailed statement. Economists expected a 0.35 percent increase on the month and a 3.9 percent rise on the year, according to the median estimate of analysts surveyed by Bloomberg.
Peru’s central bank raised reserve requirements yesterday after a pick-up in private investment boosted the outlook for the $176 billion economy. The measures seek to brake the sol’s 2.3 percent advance this year while preventing an inflow of dollars from accelerating credit growth and fueling inflationary pressures, said Roberto Flores, head of research at Inteligo SAB.
“The central bank is concerned about inflation and wants to prevent credit growth returning to levels of about 20 percent,” Flores said in a phone interview from Lima. “After these measures, it’s less likely the central bank will have to raise rates” on stronger domestic demand.
Peru’s economy expanded 7.2 percent in February, the fastest pace in six months, as increased government spending in response to slower global growth buoyed business sentiment. Consumer prices climbed 0.77 in March, the most in eight months.
Annual lending growth slowed to 18 percent in February from 19 percent in January, the central bank said March 27.
Annual inflation will slow to about 3 percent by the end of this year as food prices ease, central bank President Julio Velarde said April 27.
The government’s consumer-price index is based on a survey of establishments conducted by the statistics agency in the Lima Metropolitan area.
Food and drink prices rose 0.9 percent last month while gasoline rose by an average 1.4 percent and bus fares climbed 9.8 percent, the statistics agency said.