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LIMA, Oct 9 (Reuters) - Peru's central bank held the benchmark interest rate at 3.50 percent on Thursday, as widely expected, saying that economic activity remained weak though it showed some signs of recovery.
The bank, which had cut the rate by 25 basis points at its last meeting, underscored that it was keeping its eye on inflation projections and its variables and would consider further easing measures if necessary.
September inflation of 0.16 percent brought the 12-month figure to 2.74 percent, within the central bank's tolerance range.
The current rate level is "compatible with an inflation projection that stays within the target range in 2014 and that converges towards 2.0 percent in 2015," the bank said.
It added that production activity data continued to highlight a weak economic cycle, with gross domestic product growth below the economy's potential, though with some signs of recovery in September.
Peru, a top world exporter of copper, silver and gold, posted a 1.65 percent economic expansion in the second quarter from the same period in 2013 - the worst reading since the third quarter of 2009.
Peru's Finance Minister, Alonso Segura, said earlier on Thursday that a fall in mineral prices will prevent the economy from growing much more than 3 percent this year.
The Andean country enjoyed growth rates that topped 6 percent in most of the past decade, when mineral prices were higher and demand from China firmer.
Twelve out of 16 foreign and local economists surveyed by Reuters earlier this week had forecast the central bank would leave the key rate unchanged this month. (Reporting by Patricia Velez and Marco Aquino; Writing by Anthony Esposito; Editing by Lisa Shumaker and Ken Wills)