The BCP Economic Studies Area indicated that the economy continues to show a gradual and cyclical recovery. Along these lines, it maintained its GDP growth projection at 3% for 2024, with the Consumer sector leading the recovery of the economic cycle.
“The factors that support the recovery are: supply shocks in 2023 that dissipate (El Niño, etc.), favorable export commodity prices, lower inflation that helps the purchasing power of households and the effect of countercyclical policies (lower reference rate and greater public investment)”, explained Carlos Prieto, Manager of the Economic Studies Area of the BCP.
Prieto Balbuena added that private consumption is expected to accelerate in the coming quarters due to lower inflation, which favors real wages (food and beverage inflation was 1% in May of this year, compared to 13% in May 2023), higher disposable income or lower debt in line with the seventh AFP withdrawal and the free availability of CTS and a recovery of employment in sectors affected by El Niño in 2023 (fishing, agro-exports, textile sector oriented to the local market).
Despite this, the executive stated that the Peruvian economy shows signs of improvement, but the recovery is not generalized.
“To resume the path of development and growth of the middle class we need to maintain the anchors of macroeconomic stability, take advantage of the favorable price of copper to trigger a new cycle of mining investment and better political conditions,” explained Carlos Prieto.
During the presentation of the BCP’s Quarterly Macroeconomic and Market Report, Prieto estimated that inflation will close the year between 2% and 2.5%.
Furthermore, total inflation will remain around its current levels in the coming months, although it would accelerate slightly in the fourth quarter of this year. Regarding the exchange rate, he estimated that it will close the year at around S/3.75.
Finally, regarding monetary policy, the BCP decided to maintain its perspective that the BCRP rate will close this year between 4.5% and 5%, as it will continue to make its monetary policy position more flexible in a context of inflation and its expectations. within the target range.
Fiscal deficit will continue to extend in 2024
At another time, the BCP representative assured that our country could once again be exposed to a degradation of its rating due to the fiscal spending policies promoted by Congress, among other factors.
In this sense, Prieto criticized, like the Fiscal Council, that the Ministry of Economy and Finance (MEF) seeks to raise the ceiling of public spending by 2028 in the hope of meeting its fiscal goals, in a decision that he considered seeks to burden him the task to the next government.
Source: Larepublica
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