Deutsche Bank Still Sees Peru's Central Bank Cutting Rates by 50bps by End 2025 After Last Week's Hold

11:21 AM EDT, 07/14/2025 (MT Newswires) -- Peru's central bank (BCRP) left the policy rate unchanged at 4.50% last week, in line with Deutsche Bank's expectations.

In BCRP's assessment of the inflation outlook remained constructive. On the other hand, the characterization of economic activity was slightly more downbeat, while authorities continued to see a challenging outlook for the global economy, noted the bank.

However, the forward guidance maintained a similar tone compared with last month's policy statement, preserving the easing bias but without signaling an imminent cut, said Deutsche Bank.

The bank retains the expectation of 50bps in additional cuts to be delivered by year-end, with the next reduction likely to be delivered in late Q3.

Deutsche Bank predicts USDPEN to gradually move higher, with a year-end forecast at 3.70. It keeps a "moderately" bearish bias on the sol (PEN).

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