Peru GDP growth picks up in February

Monday, April 16, 2018

Peru's economic growth accelerated for a second month in February, helped by gains in the iron and steel industry and output of half-a-dozen major metals.

GDP expanded 2.9% in the month, up from 2.8% and 1.3% in January and December, respectively, the statistics office said in a report.

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Manufacturing, construction, fishing, agriculture, banking and telecommunications also gained, offsetting a slump in natural gas, the government said.

Manufacturing climbed 0.39%, helped by a 12.9% expansion in the iron and steel industries which offset precious and non-ferrous metals refining (-0.6%) and metallic products (-8.3%). Iron and steel exports rose to the US, Brazil, Colombia and Chile, according to the agency.

Mining production rose 1.4% as copper climbed 0.7%, along with zinc (+8.6%), lead (+5.8%), tin (+5.9%), silver (+2%) and iron ore (+41.2%), the agency said. Gold (-8.4%), and molybdenum (-0.5%) production both fell.

Construction expanded 7.9% as central, regional and local governments all increased public spending and cement sales climbed 4.3%, the agency said.

The government, which changed hands last month, is working to accelerate spending on a 26bn-sol (US$8bn) reconstruction program following record flooding and landslides sparked by the El Niño phenomenon last year.

Peru's central bank last week held its benchmark lending rate unchanged at 2.75%, citing controlled inflation. The bank will probably move towards rate cuts later this year, according to UK consultancy firm Capital Economics.