LIMA, May 17 (NNN-ANDINA) – Healthy credit expansion and a surge in mining investment throughout the first quarter of 2019 should have cushioned Peruvian economy’s slowdown somewhat, the latest FocusEconomics’ LatinFocus Consensus Forecast report affirmed.
On the fiscal front, the 12-month rolling budget deficit in March dropped to 1.9% from February’s 2.1%.
“The favorable fiscal developments led the Ministry of Economy Finance to trim the 2019 fiscal deficit target to 2.2% of GDP from the previous target of 2.7%,” it expressed.
Meanwhile —in early May— the Government signed a Memorandum of Understanding (MoU) with China on the Belt and Road Initiative.
The MoU is expected to bring increased infrastructure investment and should also lead to an expansion in the existing bilateral Free Trade Agreement.
Likewise, continued job gains and steady credit growth should underpin consumer spending.
Moreover, solid growth in exports of commodities, positive business sentiment, and rising infrastructure spending should support fixed investment.
Within this framework, FocusEconomics panelists see GDP growing 3.8% in 2019, which is unchanged from last month’s forecast, and 3.7% in 2020.
For its part, the Peruvian Government projects the economy will expand over 4% this year.
NNN-ANDINA
