UPDATE 1-Peru's central bank cuts '09 forecasts on crisis

(Recasts, adds inflation, context)

LIMA, March 13 (Reuters) - Peru’s central bank revised some of its 2009 estimates on Friday to reflect the reality of a global economic slowdown, which has pummeled prices for most of Peru’s metal exports.

The bank cut its domestic demand forecast for this year to 5 percent, from a previously seen 7.1 percent, and said it expects a 2009 fiscal deficit of 1 percent of gross domestic product, from a prior surplus forecast of 1.1 percent of GDP.

Peru, a major metals exporter, posted its last fiscal deficit in 2005 and since then has posted surpluses.

The bank also slashed its 2009 growth estimate on exports to 1.9 percent, from an earlier forecast of 6.2 percent, and said imports will increase 2.1 percent this year, slower than a prior projection of 9 percent growth.

Mining exports, which account for more than half of Peru’s total exports and are the government’s largest source of revenue, have tumbled on falling commodity prices.

Speaking to reporters, Peru’s Central Bank Chief Julio Velarde said he sees inflation closing the year at 2 percent, easing from 6.65 percent posted in 2008.

The bank’s annual inflation target is 2 percent, plus or minus a one percentage point tolerance band.

The bank held its 2009 growth estimate steady at 5 percent, down from the blistering 9.8 percent posted last year. (Reporting by Teresa Cespedes; Writing by Dana Ford; Editing by Diane Craft)