* Bigger increase for dollar reserves than for sol reserves
* Bank seeks to mitigate foreign currency borrowing risks
BUENOS AIRES Dec 30 Peru's central bank will
raise reserve requirements next month to control a credit boom
and discourage inflows of speculative capital while the local
currency appreciates to 16-year highs, the monetary authority
said on Sunday.
Reserve requirements on bank deposits in sols will
rise by 25 basis points in January while those for U.S. dollar
deposits will climb by 75 basis points.
"The bigger adjustment for dollar reserves seeks to mitigate
the risks involved with foreign currency borrowing," the bank
said in a statement.
Prior to this measure, the central bank raised reserve
requirement four times this year. The average reserve rate in
soles stood at 17.8 percent, and 40 percent in dollars in
October this year, according to central bank data.
The sol closed at 2.552 per U.S. dollar on Friday,
ending the year with gains of 5.72 percent despite record
intervention by the central bank, which purchased $13.85 billion
in U.S. dollars to curb the currency's advance.
The bank bought dollars in the local spot market every day
since Aug. 27 but only managed to slow the pace of the
currency's appreciation, not stop it.