Bloomberg News

Peru Prices Unexpectedly Fell Last Month as Food Costs Declined

March 01, 2013

Peruvian consumer prices unexpectedly fell last month as declining food prices offset increases in all other segments, the government reported.

Consumer prices dropped 0.09 percent from January, the first decrease in three months, the government’s statistics agency said in an e-mailed statement today. The median forecast of 12 analysts in a Bloomberg survey was for a 0.18 percent increase. The annual inflation rate slowed to 2.45 percent from 2.87 percent in January, the agency said.

Food and drink prices dropped 0.7 percent last month while electricity costs rose 2.3 percent. Gasoline rose 3 percent and private schooling fees climbed 2.5 percent, the agency said.

Peru’s central bank may consider cutting borrowing costs if inflationary conditions allow, its research director Adrian Armas said Feb. 8 after policy makers kept their benchmark lending rate at 4.25 percent. Policy makers have held Peru’s rate, the lowest in Latin America after Colombia, for 21 consecutive months. The central bank projects inflation of 2 percent this year, the mid-point of its target range.

Peru’s economy expanded at the slowest pace in a year during the fourth quarter, rising 5.9 percent from the same period of 2011, as construction activity slowed and fishing contracted, the agency said Feb. 22.

To contact the reporter on this story: John Quigley in Lima at jquigley8@bloomberg.net

To contact the editor responsible for this story: Andre Soliani at asoliani@bloomberg.net


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