Peru

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.

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.

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.

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.

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.

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.

Peru’s Finance Minister Pedro Francke was given assurances from the new government that he’ll be able to implement his economic program, he said in the first interview since securing his new role, Bloomberg News reported. Francke, a former World Bank economist, was sworn in late Friday, a day when markets crashed amid investor concern that he wouldn’t take the post due to differences with other members of the cabinet appointed by President Pedro Castillo. These included Guido Bellido, a lawmaker who considers the communist government of Cuba to be a democracy, as prime minister.

Peruvian assets tumbled on concern new President Pedro Castillo’s top economic adviser may not take a cabinet role, further fueling investor anxiety over his government’s plans to remake the economy, Bloomberg News reported. An ETF tracking Peru stocks fell more than 7%, the currency had its worst day since 1994 and overseas bonds due in 2031 slipped to the lowest in seven weeks.

Investors sent Peruvian bonds sliding in the aftermath of President Pedro Castillo’s inaugural call for a new constitution and choice of prime minister, Bloomberg News reported. Peru’s dollar bonds due in a century are the second-worst performers in the world on Thursday, beating only serial-defaulter Belize, according to data compiled by Bloomberg. Meanwhile, the yield on the benchmark bond due in 2031 rose to the highest since the close on June 16, a day after the final vote count showed Marxist party-backed Castillo winning the election.