Velarde: Rise in energy prices prevents estimating when inflation will return to the BCR’s target range

External inflationary pressures, added to the rise in the price of energy at the world level, have caused the Central Reserve Bank (BCR) to not be able to give an accurate projection on when the inflation rate returns to the target range of between 1% and 3 %, according to the president of the monetary authority, Julio Velarde, said on Tuesday.

“The central bank will do everything possible to bring inflation back to the target range within the monetary policy horizon within two years”Velarde pointed out during the 2021 Economic Forum, developed by AmCham Peru.

The president of the BCR made known that the inflation it would close at 4.9% for this year, while in 2022 it would be 2.6%, although he specified that these estimates could vary in two weeks if the rise in energy resources persists.

“We estimated that the second half of next year will return to the target range, but oil continues to rise and there are people who project that it will rise to US $ 100 by the end of the year”, He indicated.

The Petroleum The US benchmark has risen by 72% since the beginning of the year and has exploded especially in recent weeks driven by increasing demand and supply shortages. Currently, it is above US $ 80.

Despite the interventions that the central bank may have, there are some factors outside of monetary policy that can prevent higher inflation, according to Velarde.

Among these, he mentioned, is the shortage of some products in markets in the United States and Europe, the rise in the price of fertilizers and weather phenomena that affect crops in other countries.

“In conclusion, the supply chain around the world is being affected. We are not involved in those factories, that is why it is not being seen in Peru with such force (the impact)”, He pointed out.