Peru’s central bank: inflation may hit target sooner than expected

LIMA (Reuters) – Peru’s inflation rate could converge to the central bank’s target sooner than expected, the head of the bank said on Wednesday, arguing that the rate of rising prices in the Andean nation is now under control.

“We expect it to return to the (target) range, if not in December, in the first quarter or in April next year,” central bank head Julio Velarde said, hinting at an earlier-than expected easing of inflation.

The central bank had previously said inflation would converge to target in April.

Peru’s annual inflation rate slowed to 3.64% in November, bringing the rate or rising consumer prices closer to the central bank’s target range of between 1% to 3%.

The bank will announce on Thursday any changes to its benchmark interest rate after cutting it to 7% last month.

“The important thing is that we have raised the interest rate much less than the rest of the region and we are getting inflation to return faster (to the target) than the other countries,” said Velarde.

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