Monetary Program for July 2026: BCRP maintained the reference interest rate at 4.25%

INFORMATIONAL NOTE
MONETARY PROGRAM FOR JULY 2026
BCRP MAINTAINED THE REFERENCE INTEREST RATE AT 4.25%

1. The Board of Directors of the Central Reserve Bank of Peru (BCRP) agreed to maintain the reference interest rate at 4.25 percent.
2. The decision to maintain the reference rate took into account the following information and projections:
   i. In June, monthly inflation was 0.23 percent and inflation excluding food and energy was 0.08 percent, both compatible with the target range in annualized terms. The month's result was mainly explained by the increase in prices of some foods, particularly fish, affected by anomalous swells. In year-on-year terms, total inflation increased from 3.9 percent in May to 4.0 percent in June, while inflation excluding food and energy increased from 4.4 to 4.5 percent in the same period. This deviation from the target range is mainly due to the rise in fuel prices and their indirect effects on transport costs in March and April. Excluding the transport sector, underlying inflation stood at 1.6 percent year-on-year, and has remained below 2 percent since April last year.
   ii. Twelve-month inflation expectations decreased from 2.9 percent in May to 2.8 percent in June, remaining within the inflation target range.
   iii. Both year-on-year inflation and inflation excluding food and energy are projected to return to the target range and settle around 2 percent within the projection horizon, as the effects of supply shocks dissipate. However, there is a risk that a more intense El Niño phenomenon and geopolitical tensions in the Middle East could have more persistent effects on inflation.
   iv. Leading indicators of economic activity for June continue to show good performance. In the Central Bank's survey, most current situation indicators registered an improvement compared to the previous month, while expectation indicators showed a significant increase, all placing them in the optimistic range.
   v. Global risks have recently moderated due to the easing of geopolitical tensions in the Middle East and the relative normalization of supplies in the hydrocarbon market, which has led to a downward correction in international oil prices. However, uncertainty associated with geopolitical tensions remains. In this environment, global economic activity growth prospects for this year continue to be positive, and terms of trade remain favorable for the Peruvian economy.
3. The Board remains especially attentive to new information on inflation and its determinants, including the evolution of underlying inflation, inflation expectations, economic activity, and the duration of supply shocks, in order to make adjustments to the monetary policy stance if necessary. The Board reaffirms its commitment to adopt the necessary actions to ensure the return of inflation to the target range within the projection horizon.
4. In the same session, the Board agreed on the following interest rates for BCRP's national currency operations with the financial system under the window facility.
   i. Overnight deposits: 2.25 percent annually.
   ii. Direct repo operations for securities and currency, and Monetary Regulation Credits: i) 4.75 percent annually for the first 10 operations in the last 3 months; and ii) the interest rate set by the Monetary and Exchange Operations Committee for operations additional to these 10 operations in the last 3 months. Furthermore, the Monetary and Exchange Operations Committee may establish higher rates based on the amount of the operations.
5. The next Board session to evaluate the Monetary Program is scheduled for August 13, 2026.
   Lima, July 9, 2026