Peru holds key rate steady

Peru's central bank held its policy interest rate steady at 2.75% as the country's economy gathers strength.

The bank expects inflation to remain within the target range of 1.0-3.0% in August and converge to 2% by the end of the year. Monthly inflation was 0.38% in July, bringing annual inflation to 1.62%.

"The board considers it appropriate to maintain an expansive monetary policy position until it is certain that said convergence occurs in a context in which inflation expectations are anchored in an environment in which the level of economic activity is near its potential," the bank said in a statement.

In the bank's latest survey of economists, conducted at the end of July, respondents forecast that GDP will expand 4.0% this year, up from a projection of 3.8% made in June.

Economic activity rose 6.4% year-on-year in the month after increasing 7.8% in April.