Peru

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Peru's central bank on Friday said it had reduced its growth projection for 2022 to 3.1% from 3.4% previously amid global economic volatility and a recent disruption to mining activity in the Andean nation, Reuters reported. The bank maintained its estimate for 3.2% GDP growth in 2023, bank president Julio Velarde said in a presentation accompanying its latest macroeconomic projections report. It saw a lower fiscal deficit for 2022 of 1.9% of GDP compared to a previous 2.5% projected in March, principally due to higher fiscal revenues, Velarde said.
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Peru’s foreign debt has touched record lows as a wave of social unrest amid quickening inflation upends a market once famed for its resilience to near-perpetual political crisis, Bloomberg News reported. Government bonds due in 2031 have tumbled 5.5 cents since early last week to trade at 89 cents on the dollar on Tuesday, lingering near an all-time low. The extra yield investors demand to hold Peru’s bonds over U.S. Treasuries, meantime, is at 194 basis points, versus just 165 a week prior, according to JPMorgan Chase & Co. data.
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Peru's economy is expected to have stayed above pre-pandemic levels in December and January, due to the recovery of internal demand and a record in exports, despite lower mining output after recurring social conflicts, the central bank said Friday, Reuters reported. "The economy is recovering, the output gap is closing, but it would still be below its potential," said Adrián Armas, manager of economic studies at the Central Bank, citing the bank's December and January advance indicator reports.
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Peru’s inflation slowed more than expected in January as transportation prices fell, providing a welcome relief to the central bank which faced in 2021 the fastest rise in prices in 13 years, Bloomberg News reported. Annual inflation slowed to 5.68%, compared with the 5.99% median forecast of analysts surveyed by Bloomberg. Consumer prices increased 0.04% from December, the national statistics bureau reported Tuesday. Prices for food, energy and fuel surged in Peru and across Latin America last year as the pandemic and lockdowns spurred supply-chain snarls and shortages.
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Peru's economy grew 4.55% year on year in October, the government statistics agency INEI said on Wednesday, as the world's second-largest copper producer saw a slowdown in growth after the economy recovered to pre-pandemic levels, Reuters reported. The growth level is the lowest since March and in line with a forecast from the central bank, which said on Friday that economic growth was likely to have lost steam and grow between 4% and 6%. INEI added that Peru's economy had grown 15.99% in the first ten months of the year.
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Peru's economy is likely to have lost steam in October, the central bank said on Friday, estimating it would have grown between 4% and 6% in the period, the lowest rate since March, when the economy started rebounding from the pandemic, Reuters reported. Economic expectations from the business sector have also deteriorated, the bank's head of economic studies, Adrian Armas, said in a conference call. Peru on Thursday lifted its benchmark interest rate for the fifth month in a row, to 2.5% from 2%, amid persistent inflation.
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Peru is joining the global push to develop a central bank digital currency (CBDC), central bank President Julio Velarde said on Tuesday, as policymakers worldwide seek to keep pace with fast-spreading cryptocurrencies, Reuters reported. Speaking at a conference with business leaders in Lima, Velarde said that Peru's central bank is working with the central banks of India, Singapore and Hong Kong in developing a CBDC. "We are not going to be the first, because we don't have the resources to be first and face those risks," Velarde said, "But we don't want to fall behind.
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The Peruvian economy grew 9.71% year-on-year in September, slightly above a recent central bank projection, but its slowest pace of expansion since March as it recovers from the COVID-19 pandemic, the government reported on Monday, Reuters reported. Three days earlier, the central bank estimated that the economy had grown between 8.5% and 9.5% in September. In September last year, the economy of the world's second-largest copper producer fell 6.10% year-on-year, when Peru closed large swathes of its economy due to the pandemic.
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Peru's gross domestic product expanded 11.83% in August compared with August 2020, marking six straight months of economic growth for the South American country, the government's INEI statistics agency said in a statement on Friday, Reuters reported. The expansion in August was principally driven by the construction and manufacturing sectors, the agency said. In the first eight months of 2021, Peru's economy grew 18.59%, the INEI statement said. In the 12-month period through August, the country's GDP expanded 10.46%, it added.
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Peru’s sol rebounded from a record low after Central Bank President Julio Velarde agreed to stay in the post for another five-year term, Bloomberg News reported. Velarde, 69, has been in the role since 2006, overseeing a long period of relatively strong growth and low inflation. After a series of conversations with new Finance Minister Pedro Francke about extending his tenure, the decision was made on Monday afternoon. The sol gained 1.6% to 4.05 per dollar at 9:10 a.m. in Lima, the biggest increase in emerging markets on Tuesday.
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