Uruguay maintains interest rate at 11.25%

The Central Bank of Uruguay (BCU) resolved yesterday to maintain the Monetary Policy Rate (TPM) at 11.25 percent after the 25 basis points decrease reported in April, in line with the contractionary phase of the monetary policy.

Closing inflation in April “stood at 7.61 percent, with a slight increase with respect to the March measurement”.

However, “core inflation remained stable (6.22 percent) at one of the lowest levels in the last five years”, according to the BCU’s statement after the meeting of the Monetary Policy Committee (COPOM).

The report states that the global economic environment presents a “heterogeneous scenario”.

On the one hand, “there are risks of a slowdown in the growth of economic activity and financial fragility”.

On the other hand, “inflation continues to move slowly downward in the context of commodity price stability and the recovery of global supply chains.

“Based on the general outlook put forward, the BCU Board of Directors decided to maintain the Monetary Policy Rate (MPR) at 11.25 percent,” the statement said.

“This level is considered consistent with a contractionary monetary policy aimed at continuing the efforts for the convergence of inflation and its expectations in the 24-month horizon,” it concludes.

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