March 12, 2015 / 11:45 PM / 4 years ago

UPDATE 1-Peru central bank holds key rate steady as currency falls

(Adds context, comment from central bank statement)

LIMA, March 12 (Reuters) - Peru’s central bank left the benchmark interest rate unchanged at 3.25 percent on Thursday as the local sol currency trades near a six-year low and economic growth remains below its potential.

Thirteen out of 15 analysts polled by Reuters had forecast the central bank would hold the rate for a second month in a row to avoid prompting a steeper slide in the sol .

The central bank has intervened with $2.79 billion in the local spot market as the sol has slipped 4 percent against the dollar so far this year.

The bank lowered the key rate by 25 basis points in January to encourage growth, its third reduction since July as the economy grew at its weakest pace since 2009.

The bank said in a statement that recent indicators of business and consumer expectations continue to point to a weak economic cycle.

It also reiterated in a statement that growth remains below its potential rate, the pace at which the economy can expand without stoking inflation.

It said last month that it now sees the potential growth rate at about 5 percent. The economy expanded by 1 percent in the fourth quarter from the same period a year earlier.

Peru’s mining-fueled economy has slowed sharply over the past year on lower global mineral prices and weak copper and gold output. (Reporting By Lima Newsroom; Editing by Andre Grenon)

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