Peru: Trade balance registers record deficit on sharp contraction in exports
March 10, 2014
In January, the trade balance registered a deficit of USD 783 million, which was more than double the USD 328 million deficit observed in the same month last year. The print marked the largest deficit since the country began keeping monthly records in 1985. In the 12 months up to January, the trade balance posted a USD 820 million deficit. Exports contracted 17.6% over the same month of the last year (December: -9.4% year-on-year), which marked the sharpest contraction since August 2009. Imports contracted 4.0% in January, which contrasted December's 0.8% expansion. A downward trend has been registered in the trade balance in the last two years. The trend has been driven mainly by low international prices for traditional Peruvian exports such as copper and natural gas, which more than offset the effect of the increase in volumes exported for these commodities. In the case of imports, despite also lower international prices, the increase in volumes has also been affecting negatively the trade balance. In its quarterly inflation report from December, the Central Bank stated that it expects exports to grow 3.2% in 2014. For 2015, the Bank sees overseas sales expanding a healthier 12.3%. LatinFocus Consensus Forecast panelists see exports expanding 7.6% this year, which is up 0.2 percentage points from previous month's estimate. For 2015, the panel sees overseas sales expanding 9.2%.