Peru: Economic activity slows sharply in December
February 15, 2013
In December, economic activity increased 4.3% over the same month the previous year, which was well below the 6.8% expansion observed in November and marked the slowest print since January 2010. The moderation exceeded market expectations that had economic activity decelerating to a 6.0% increase. Slower growth in construction and a deterioration in manufacturing production were the main drivers behind the December print.
A month-on-month comparison confirms the slowdown suggested by the annual data, as economic activity grew a seasonally adjusted 0.14% in December, which was well below the 1.11% expansion observed in November.
Based on monthly data, the economy expanded 6.0% annually in the fourth quarter, slower than the 6.5% increased tallied in the third quarter.
Meanwhile, according to preliminary data released by the national statistical office (INEI), the economy grew 6.3% in 2012, which was below the 6.9% expansion recorded in 2011.
The Ministry of Finance expects GDP to expand between 6% and 7.0% in the first quarter of this year. Furthermore, in its December inflation report, the Central Bank predicts the economy to grow between 6.0% and 6.4% in the full year 2013. For 2014, the Bank sees the economy expanding between 6.0% and 6.5%.
Author: Ricardo Aceves, Senior Economist