Bloomberg News

Peru Growth Quickens as Economy Shrugs Off Export Drop

July 15, 2012

Peru’s economic growth quickened in May as domestic demand buffers the economy against weaker global markets for the country’s copper and textiles.

Economic activity rose 6.5 percent from the same month a year earlier, after a 4.4 percent expansion in April, the government’s statistics agency said today in an e-mailed report. Economists predicted growth of 5.3 percent, according to the median estimate of 14 analysts surveyed by Bloomberg.

The government will spend the equivalent of 2.5 percent of gross domestic product this year to protect Peru’s commodity- dependent economy from slowing global growth. The Andean nation posted its biggest trade deficit since 2008 in May as copper prices fell and imports rose to a record.

“As long as domestic consumption remains strong, growth should remain close to potential,” said Alejandro Arreaza, an analyst at Barclays Plc, in a phone interview from New York.

The central bank left borrowing costs unchanged at 4.25 percent for a 14th straight month July 12 as growth holds near potential while consumer prices ease.

To contact the reporter on this story: John Quigley in Lima at jquigley8@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net


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