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Peru GDP Q2 2023

Peru: Economy records sharpest contraction since Q4 2020 in Q2

GDP contracted at a sharper pace of 0.5% year on year in the second quarter, below the 0.4% contraction tallied in the first quarter. Q2’s reading marked the worst reading since Q4 2020. On a seasonally-adjusted quarter-on-quarter basis, GDP declined at a more moderate pace of 0.2% in Q2, compared to the previous period’s 0.6% fall.

Household spending increased 0.4% in the second quarter, which was above the first quarter’s 0.2% expansion. Government spending rebounded, growing 2.7% in Q2 (Q1: -5.9% yoy). Meanwhile, fixed investment contracted at a more moderate rate of 6.3% in Q2, from the 10.7% contraction recorded in the prior quarter.

Exports of goods and services growth picked up to 7.7% in Q2 (Q1: +2.4% yoy). In addition, imports of goods and services declined at a milder rate of 3.0% in Q2 (Q1: -3.2% yoy).

Commenting on the outlook, Julio Ruiz, analyst at Itau Unibanco, stated:

“Our 2023 GDP growth forecast stands at a below potential growth rate of +0.8%. The El Niño phenomenon will likely curb activity for the rest of the year in the context of a tight monetary policy stance.”

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