At the end of 2023, the Peruvian GDP had four consecutive negative quarters and showed a contraction of 0.6%—its worst result since 1992.
A few days after knowing the official data on economic activity for January, the Central Reserve Bank of Peru (BCRP) announced that a recovery in production is already being observed, so in the first quarter of this year there would be a positive result .
“After four consecutive quarters of decline. Lower inflation and recovery of average income in the private sector in real terms would point to a market recovering (…) All indicators point to positive growth in January and February. Probably since January,” mentioned Adrián Armas, central manager of Economic Studies at the BCRP.
According to the INEI in its latest report on the conjunctural progress of economic activity, in January mining and hydrocarbon production grew 3.96%, the electricity subsector 3.85% and 4.59% in the first two months, and internal cement consumption , 9.25% during the first month.
When will inflation normalize?
Armas specified that although inflation in February rose to 3.3% and moved away from the upper limit of the target range – from 1% to 3% – it is expected that this temporary phenomenon will be controlled, at the latest, in April.
“In relative terms, there is low inflation (…) We are going to converge to the target range in the coming months. March or April, calmly”Armas noted.
According to the BCRP, the rise in inflation was due to the high prices of chicken, eggs, fish and water service rates.
Source: Larepublica
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