The Central Bank of Uruguay looks closely at international factors that could accelerate inflation internationally.
He Central Bank of Uruguay (BCU) closely observes the wars in the east of Europe and the Middle East, the impact of floods on Brazil and the decision of the United States Federal Reserve on the reference rate as some of the signals that could affect an eventual rise in inflation on an international level.
According to the last minute of the Monetary Policy Committee (Copom), where the BCU decided to maintain the interest rate At 8.5%, the authorities observed the global panorama and valued the “positive data” on inflation that advanced economies showed.
However, from the monetary authority they put a magnifying glass on the war conflicts, both between Russia and Ukraine how between Israel and Hamas, considering that “they could generate upward impacts on prices.”
In turn, the board observed that the CPI increased by USA due to the rise in commodities and wages and noted that “in this context, market agents expect that the reference rate of the Fed “stays high for longer.”
“This expectation explains the appreciation of dollar at a global level in recent weeks and the correction in the equity markets,” the central bank elaborated on the international factors that it closely follows.
The alarm signals of the region
At the regional level, the BCU anticipated that in Brazil there are “risks of an increase” in inflation due to “the robustness of the labor market, the impact of floods in the price of food, the pressures coming from commodities and the fiscal policy”.
As to Argentina, assured that there is “a drop in the level of activity in the first months of the year”, at the same time that there is “a rapid reduction in inflation monthly”.
Source: Ambito
