Peruvian economy on the path to recovery: optimistic projections from the Central Reserve Bank of Peru

The Peruvian economy is projected to be on the path to recovery, according to the latest estimates from the Central Reserve Bank of Peru (BCRP). The president of this institution, Julio Velarde, has announced that a growth of 3% is expected for the year 2024, thus maintaining the projections made last December. While the overall figure has remained stable, significant adjustments have been made in some key sectors. In particular, private investment, a fundamental driver for the country's economic development, is estimated to grow by 2.3% this year, surpassing the previous projection of 1.8%. This increase in private investment will contribute to the growth of domestic demand, which is expected to reach 3.1% instead of the 2.9% forecasted in the previous report. According to Velarde, these optimistic projections are based on a lower impact of inflation on the population's purchasing power and on a socio-political stability environment that will favor the recovery of both consumption and private investment in the country. Regarding investment in the residential sector, a growth of 1.1% is expected for this year, following the 13.3% decline experienced last year. On the other hand, mining investment is projected to increase by 7.8% in 2024, after a decrease of 13.3% in 2023. Velarde mentioned that some mining companies show a more positive attitude, which could lead to even greater growth in this sector. As for non-mining, non-residential investment, a growth of 2% is expected for this year, following the 2.7% decline recorded in 2023. Velarde pointed out the possibility of an upward bias in this projection, which could be confirmed in the next inflation report scheduled for June 2024. These data reflect a promising outlook for the Peruvian economy, with prospects for growth and recovery in various sectors. Socio-political stability and positive expectations for private and mining investment contribute to generating confidence in the country's economic future.