The Economic Studies Area of Banco de Credito del Peru (BCP) estimated that October’s GDP would have bounced around 6.5%, compared to the same period in 2020, when it fell 3.2%, and reiterated its growth projection for the Peruvian economy by 2% by 2022.
Thus, the Peruvian economy rebounded almost 11.5% year-on-year in the third quarter of 2021 and 1.7% compared to the third quarter of 2019. The monthly indicator of economic activity rebounded 9.7% year-on-year in September 2021 (compared to – 6% of September 2020) and 3.1% compared to September 2019.
“On the one hand, the Peruvian economy will enter with greater inertia to 2022 as a result of the 2021 rebound better than initially expected. On the other hand, the monetary environment looks more challenging than three months ago as a result of higher inflation that will lead the FED (and other central banks, including the BCRP) to raise their rate faster, ”the office explained.
In seasonally adjusted terms, in September the economy grew around 1% month-on-month. For 2022, his forecast that the economy would grow only around 2% is maintained.
The BCP Macroeconomic and Markets Weekly Report explains that this result is due to the fact that, with the inflation adjustment of Metropolitan Lima, chicken sales, food consumption, use of applications for delivery, among others, grew 38% year-on-year in October and 41% compared to October 2019, from according to the Weekly Consumer Index, which includes transactions through BCP credit and debit cards, as well as congestion indicators.
Likewise, the Economic Studies Area of the BCP stated that the general government’s public investment fell 14% compared to October 2019 and that the internal consumption of cement grew 16% compared to the same month of that year.
“Even so, internal cement consumption grew 16% compared to October 2019 (it had already grown 24% in September). For 2022 we maintain our forecast that the economy would grow only around 2% ”, indicated the BCP.
BCP: GDP by sectors
According to the Economic Studies Area of the BCP, the primary sectors grew around 8% year-on-year in October. The increase was mainly explained by mining (+ 12.3%, thanks to copper + 18% and gold + 20%), agriculture (+ 11.5%) and hydrocarbons (+ 4%).
On the contrary, the fishing sectors (-39%) and the manufacturing of primary resources (-11.3%) fell. Non-primary sectors rebounded around 10.5% year-on-year. The total services sectors grew 10% and commerce 7.4%. Likewise, the construction sector increased 12.6% (in September it had already grown 18%).
BCP: reference rate will reach 3.5%
The BCP also referred to the recent decision of the Central Reserve Bank (BCRP) to raise the reference rate from 1.5% to 2%, and estimated that next year said index could reach 3.5%.
“The BCRP will continue to raise its reference rate. Last Thursday, November 11, it raised it from 1.5% to 2% (an increase of 175 basis points since July). We believe that next year the nominal rate will rise to levels 3% to 3.5%, with the aim of having a real monetary policy rate of zero or slightly positive ”, he endorsed.