Lima : Peru's central bank President Julio Velarde comments on the Peruvian economy becoming less "dollarised", currency reserves and controls on capital. Velarde spoke on Saturday to reporters at the central bank in Lima.
"Between 2001 and 2009, the level of the economy's dollarisation fell from about 82 per cent to 46 per cent. If the amount of credit in soles and dollars continues to grow at the same rate as the last five years, the level dollarisation will have fallen to around 20 per cent in five years' time.
"The level of dollarisation left us more exposed to the global financial crisis. Once the crisis hit, all the money flowed to the US, which is why we saw pressure on the exchange rate in Brazil and Mexico.
"Of late we have been holding a little less of our reserves in dollars. We were intending to go more toward euros but when we saw the outlook for the euro versus the dollar we proceeded more slowly and therefore the composition of our reserves has barely changed.
"We intervene in the currency market, but we've never thought about imposing the restrictions on capital that they have in Brazil, Colombia and Chile. We are a very open economy and in the long-term that is going to strengthen us.
"In Brazil and Colombia, they don't allow dollar-denominated accounts, and there are also limitations in Mexico, Chile and Argentina. In Peru there is complete freedom."
