LIMA, Peru?The benchmark consumer-price index increased in October, bringing Peru's 12-month inflation rate to its highest level in five months, the government said Tuesday.

The CPI rose 0.41% in October from the previous month, the second highest rate this year due to an increase in food prices, national statistics agency INEI said. That put the annual inflation rate at 3.41%, the highest since May.

The uptick in the annual rate poses a problem for the central bank, which aims to keep inflation between 1% and 3%. The central bank has maintained its reference interest rate at 4.25% in recent months as inflation eased toward the target range.

But October marks the second month in a row when the annual inflation rate has increased. The central bank next meets on Nov. 10.

In October, prices in the food and beverage sector increased 0.74% on higher potato and chicken costs, INEI said.

Transportation and communications costs climbed 0.35%, while housing, fuel and electricity costs rose 0.27%, the government said.

Peru's gross domestic product is expected to grow about 4% this year, after expanding 3.3% in 2015.

Write to Ryan Dube at

(END) Dow Jones Newswires

November 01, 2016 02:05 ET (06:05 GMT)

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