Peru's Central Bank Optimizes 2023 Economic Growth Amid Mixed Sector Performance

Peru's central bank has slightly increased its 2023 economic growth forecast to 3.1%. Primary sectors, especially fishing, are expected to drive this growth despite a setback from the El Nino phenomenon. The mining sector will see modest growth, while public investment is predicted to increase significantly.

Peru's central bank on Friday slightly raised its economic growth forecast for the Andean nation this year to 3.1%, compared to 3.0% previously.

The monetary authority's chief, Julio Velarde, said in a presentation that growth would come from the primary sector, particularly in fishing. Peru is a major exporter of anchovy-based fertilizer fishmeal, though its output tanked last year after the El Nino weather phenomenon warmed sea waters.

Peru's growth in 2024 would reverse last year's slight recession caused by El Nino and lingering social unrest. The central bank hiked its estimate for public investment this year, forecasting annual growth of 12% compared to a previous estimate of 4%.

The mining sector in Peru, one of the world's largest copper producers, will likely grow less than expected, the central bank said, estimating an increase of 6.4% instead of 7.8%. It affirmed previous estimates for this year's private investment at 2.3% and inflation at 2.2%.

It also held its estimate for gross domestic product growth in 2025 at 3.0%. The monetary body projected the fiscal deficit at 2.8% of GDP this year and at 1.6% next year.