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Paraguay’s central bank lifted its benchmark interest rate to its highest level in more than a decade at 7.25% to contain the fastest inflation since 2008.

Policy makers tightened by half a percentage point for a third consecutive month. The central bank said in its policy statement it expects inflation to converge with the 4% target in the first quarter of 2024.

Latin American central banks are raising borrowing costs as Russia’s invasion of Ukraine fuels inflationary pressures in economies that were already struggling with rising food and energy prices.

Paraguay’s inflation rose for a fourth straight month to 11.8% in April. The monetary authority forecasts inflation peaking in the third quarter to finish the year around 8.2%.

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