Peru closes the year with interannual inflation of 4.05%, the lowest rate in three years

Peru closes the year with interannual inflation of 4.05%, the lowest rate in three years

Consumer prices in Peru accelerated in December and the inflation rate closed in 2023 at 4.05% year-on-year, the lowest level in the last three years. The Government said this Monday, at a time when the mining country is struggling to emerge from an economic recession. The central bank, an entity led by Julio Velarde, has projected for 2024 that the inflation rate will continue to moderate to end the year at 2.3%.

The Lima Consumer Price Index, a reference for inflation in Peru, advanced 0.41% in December, after falling 0.16% and 0.32% in November and Octoberrespectively, said the National Institute of Statistics and Informatics, Inei, in a statement.

The December result was above the forecast in a survey by the London Stock Exchange Group, which expected month-on-month inflation of 0.31%. Inflation in 2023 is the lowest since 2020 when prices rose 1.97%. Although the annualized rate has slowed, inflation remains above the central bank’s target range ceiling of between 1% and 3%.

The Economic authorities of the world’s second largest copper producer have said that the greatest risk for inflation in the country is the consequence that a worsening of the El Niño climate phenomenon would bring. with intense rains, which according to experts could occur during the first months of 2024.

The central bank reduced its reference interest rate to 6.75% in mid-December, in its fourth consecutive monthly decreasein an attempt to help the country emerge from a deep economic crisis.

Peru is struggling to reverse the adverse effects of the El Niño phenomenon, lower private investment, mainly in mining, and anti-government protests.s from the beginning of the year.