18:13 | New York (US), Sep. 29.
Fitch Ratings maintained Peru's long-term foreign currency issuer default ratings (IDRs) at 'BBB+', with outlook stable.
The credit rating agency affirmed the country's local currency IDRs at 'A-', also with outlook stable.
Peru's creditworthiness is underpinned by its track record of macro policy credibility, consistency, and flexibility, which has delivered macroeconomic and financial stability.
Strong fiscal and external balance sheets balance the country's high commodity dependence, low government revenue base, financial dollarization and structural constrains in terms of income per capita, social indicators and institutional quality.
Fitch expects the government will be able to source its remaining 2017 financing needs through PEN-denominated issuance and multilateral credits, after pre-financing its 2016 requirements and 2017 debt service.
Fitch expects the new administration of President Pedro Pablo Kuczynski to carry out a pragmatic fiscal strategy.
The administration is planning a gradual fiscal consolidation, reaching primary general government balance by 2020, as the economy adjusts to low long-term mining revenues.
The macro outlook for 2016-2017 has improved since 2015, due in part to growth in mining.
Fitch expects Peru's economic growth to rise to 3.7% in 2016 and 4.2% in 2017. This is driven by a rise in copper production through 2018, higher public investment and improving domestic confidence.
(END) MDV/RMB/MVB
Published: 9/29/2016