Peru's Economy and Finance Minister Alonso Segura projected the economy will increase by 3.2% in the third quarter of the year, higher than in previous quarters, which means it has entered a recovery phase.
“The pace of progress is likely to increase in the last three months of 2015, which would suggest the gross domestic product (GDP) is recovering,” he stated.
The Minister said that the GDP growth rate for July (3.26%) is within his sector’s expectations.
According to the National Institute of Statistics and Informatics (INEI), Peru’s GDP expanded by 1.73% in the first quarter and 3% in the second one.
On the other hand, the effects on the economy would be minimal due to the increase in the policy interest rate of the Central Reserve Bank of Peru (BCR).
This will put pressure on fiscal policy to find new mechanisms and mitigate the effects of the increased reference rate on the economy.
It is essential to anchor expectations because a complicated environment is observed with the coming electoral cycle, the El Nino event in the making, and an adverse international situation.
“Both BCR and the Executive Branch are doing what needs to be done. That’s why the draft budget for next year is moderately expansive, since fiscal support is still needed,” he pointed out.
(END) SDD/JJN/RMB/MVB
Published: 9/16/2015