Publications

The Central Reserve Bank of Peru decided to maintain its benchmark interest rate at 4.25% for the eleventh consecutive month. Although inflation is expected to return to the 2% target range, there are warnings of risks such as the El Niño phenomenon and geopolitical tensions that could generate more persistent effects.

Argentina's national inflation in July was 2.1% month-on-month (33.8% y/y), exceeding expectations. This acceleration was mainly driven by seasonal price dynamics during the winter holidays. The 2026 inflation forecast is maintained at 29%, with an upward bias.

Annual inflation declined to 6.03% in July, after four consecutive months of increases. As a result, it decreased by 11 bps compared to June, although it remains 93 bps above the level observed at the end of last year.

The euro area faces renewed inflation risks following the failed ceasefire in the Middle East. The longer the conflict persists, the more buffers will be depleted, increasing the risk of non-linear effects and of the shock spreading to the broader economy.

Consumer price inflation came in at 1.78% m/m, slightly below our expectation (1.85% m/m) and the consensus (1.9% m/m), bringing annual inflation down to 31.8%. We continue to maintain our 30% year-end inflation forecast, considering volatile energy prices and still-elevated, unanchored inflation expectations.

The Central Bank of Colombia kept the policy rate at 12% in a split decision. Additionally, a reserve accumulation program was announced.

Inflation in Spain moderated in June due to lower oil prices and government measures. However, over the medium term, higher business costs and the cyclical economic situation suggest that inflation will remain higher than that of the eurozone.