GDP falls for the sixth month in a row and registers -0.65% as of October

October has served to consolidate the recomposition of the activities that generate the greatest negative contribution to national production. The drop of 0.82% in the tenth month of the year confirms that manufacturing has been displaced by the non-primary sectors of construction and financial services—in addition to agriculture—in the area that traditionally anchors GDP.

After a modest rebound in March and April, national production chained six months of decline and started the last quarter of 2023 on the wrong foot. In the annual snapshot, the accumulated fall reached 0.65%; while the record in the last twelve months, since November 2022, offered a variation of -0.27%.

The new setback driven by construction (-9.06%), financial (-8.34%), agriculture (-7.62%), manufacturing (-2.69%), telecommunications (-2.81%), services to companies (-1.04%) and hotels and restaurants (-1.22%) were lowered by mining and hydrocarbons (3.1%), commerce (1.36%), electricity, gas and water (2 .62%), transportation (0.09%), other services (2.63%), and fishing (52%), the latter after the MEF resorted to anchovy to save the year.

In annualized terms, we have gone into negative territory from the encouraging 0% projected in September. For the economist Juan Carlos Odar, director of Phase Consultantspositive growth rates should be seen in November and December, but insufficient for the fourth quarter to end in blue.

“The December figure may be the highest growth rate of the year, but that will not be significant and will largely have a rebound effect, since it is compared to the beginning of the months of protest against the coup d’état of Pedro Castillo”, he assures.

The consensus is on a fourth quarter that, although it would be positive, would not be enough to reverse the previous poor results and would translate into a drop in GDP of -0.6%, increasingly closer to -1%. A lost year.

All in all, Odar finds room for the economy to continue recovering towards 2024 and warns of the need for favorable winds. But El Niño and the presidential vacancy loom.

Nobody is betting on Peru’s GDP at the end of 2023

Phase Consultores questions the cooling of public investment and associates it compared to the intense subnational spending executed before the 2022 regional elections, a period in which the mayors rushed to deliver the works.

Recently, the IPE has once again adjusted its economic projections downwards, deepening the expected fall in Peruvian GDP for this year from -0.3% to -0.6%.

He IMF “very likely” it will also revise downward the economic growth projection for our country, according to Rodrigo Valdés, director of the Western Hemisphere Department of said entity.