Peru raised its key interest rate for the first time in five years after inflation accelerated faster than expected and political turmoil sank the currency.
The central bank lifted its benchmark rate a quarter percentage point, to 0.5%, matching the estimates of two of seven economists surveyed by Bloomberg. One had forecast a bigger increase of half a percentage point, while the other four had predicted no change.
Inflation has accelerated in emerging markets from India to Mexico in recent months, as businesses pass on higher commodity prices to consumers, and demand picks up before supply chains are fully recovered from the pandemic. Peru’s policy makers are grappling with those same global trends, as well as with home-grown market volatility, joining a growing list of central banks tightening ultra-low monetary policy.