The Budget Commission of the Congress of the Republic He summoned the ministers of the Interior, Defense and Education to support the allocation of resources for the public sectors. In this presentation was the president of the board of directors of the Central Reserve Bank to offer their analysis of the macroeconomic assumptions underlying the fiscal year 2025 public sector budget bill.
At one point in the conversation, the legislators began to scold him for issues such as promoting employment and the existence of monetary funds, to which Julio Velarde He responded by clarifying what the functions of the BCR are.
“The reserves are part of the public sector itself, it is in the Central Bank, part of it is the reserves in the banks. If we did not have those deposits from the banks and the Central Bank, any run on dollars could be terrible. We do not issue dollars , we issue soles (…) the Government can borrow at low rates because creditors see that there are reserves. Finally, in 2021 there was the largest capital flight in history, if we had not had those reserves the exchange rate would have reached. 8,10 or 12,” he said.
Julio Velarde predicts inflation of 2.3%
In his presentation, Velarde reported that the inflation rate remained at 2.3% according to the report until the month of August and said that for this month of September he expects that figure to remain the same.
“We hope that in September it will be at a similar level or below. It will probably rise somewhat in the coming months, but we hope to end the year at 2.3%,” he explained.
He defended himself against inflation claims
One of the legislators who was also present complained to him for supposedly not doing anything to counteract inflation.
“The Central Bank could have lowered inflation, but at a very great cost, and (it would have) lowered it very little. Instead of 8.8%, which was the maximum (in June 2022), it was 7.5%, but the suffering would have been greater,” he stated.
Likewise, the head of the BCR highlighted how important it was for this organization to maintain its monetary policy independence. He said that this was key so that inflation does not get out of control, affecting the population.
