07:13 AM EDT, 05/12/2025 (MT Newswires) -- The Board of Peru's central bank (BCRP) last week lowered the reference interest rate by 25bps to 4.50%, bringing it "close" to its neutral level, noted BBVA Research.

BCRP expects headline inflation -- currently at 1.7% -- to return to the center of the target range of 2.0% and, together with core inflation, to remain around that rate over the projection horizon. It also states that economic activity is now around its potential level.

The policy statement noted that restrictive measures on international trade have led to a deterioration in global economic activity prospects, stated BBVA Research.

BBVA Research anticipates that the BCRP will continue to act "cautiously" and that, for the time being, the policy rate will remain at its current level over the coming months.