(Bloomberg) — Peru’s central bank tightened monetary policy for a fourth straight month after inflation accelerated to its fastest pace in more than 12 years.

Policy makers, led by bank President Julio Velarde, raised their key interest rate by a half-point to 2%, as forecast by six of eight economists surveyed by Bloomberg. One analyst expected an increase of 75 basis points while one saw a quarter-point hike.

Consumer prices in Peru and across Latin America have jumped as economies reopen to pent-up demand and shortages of goods due to tangled supply chains, forcing central banks to increase borrowing costs. Earlier on Thursday, Mexico hiked its reference rate by a quarter point for its fourth consecutive meeting, sticking to a steady adjustment pace, while Uruguay accelerated the withdrawal of monetary stimulus with a 50 basis-point increase.

While inflation in Peru has pushed well above the 1%-to-3% target range, the economy may post the fastest expansion in decades, allowing policy makers space to damp domestic consumer demand.

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