Peru’s central bank will raise the reserve requirement for foreign banks depositing local currency in the domestic banking system after the Sol rose to a two- year high.
The bank will raise the marginal reserve mandate to 120% of foreign banks’ domestic deposits, from the current 65%, beginning Sept. 1, it said in an e-mailed statement today.
The measure seeks to deter “short-term speculative funds” from entering the Peruvian financial system and destabilizing the currency, the bank said.
Peru’s Sol rose 0.1% to 2.7955 per dollar Thursday from 2.7975 Wednesday. That’s the currency’s strongest level since August 2008. The Sol has appreciated 3.3% this year.
With a strong economy based on mining, energy and fisheries, and a managed budget, Peru has become a renowned attraction for foreign investors.
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