BCRP: pessimism persists in short-term business expectations

In the business expectations collected by the Central Reserve Bank of Peru (BCRP) Pessimism has abounded for two and a half years, especially in those referring to the short term (three months). It should be added that it is stated that confidence is in optimistic territory when it exceeds 50 points and when it is lower, it is in pessimistic territory.

The latest survey by the monetary authority reflects that the fall has been more pronounced in the outlook for the economy (40 points), the sector where a company is developed (43 points) and investments (45 points).

Only in demand for its products is the only positive result in the short term, but it still fell from 53 to 51 points.

Although in the long term (12 months) macroeconomic expectations remain positive, there was a decline in the economy, sector and personnel hiring (see table).

And, with respect to the current situation, the feeling of worsening predominates in all items except production.

Likewise, economic analysts and the financial system also reduced their expectations for GDP, and now predict an increase of just 0.7% and 0.6%, respectively.

According to the BCRP, the leading and expectations indicators show a deterioration compared to August as a result of the shocks due to social conflicts and the coastal El Niño “which have had a greater impact than expected” on economic activity and domestic demand.