Uruguay Rate Rise ‘Strong Signal,’ Bergara, Lorenzo Say

Uruguay’s bigger-than-expected interest rate increase last week was meant as a “strong signal” that the government will do whatever it takes to control inflation, the central bank president and economy minister said.

Bank President Mario Bergara led policy makers on March 23 to boost the benchmark rate by one percentage point, to 7.5 percent, double the increase estimated by any of the four economists surveyed by Bloomberg. Uruguay’s $40 billion economy expanded 8.5 percent last year as surging demand for agricultural exports, rising consumer spending and a jump in oil and food prices pushed inflation to its fastest pace in two years.