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Macroeconomic outlook report: Peru

First quarter of 2020

During 1Q20, Peru's Gross Domestic Product registered a year-over-year growth rate of -3.39%. This performance was mainly due to the poor behavior of internal and external demand, which were heavily affected by the containment measures carried out around the globe to mitigate the spread of the Covid-19 virus. Regarding the labor market, the unemployment rate increased with respect to 4T19, up to 7.06%. The year-over-year growth rate of employment creation in Peru accelerated when compared to the previous quarter up to 1.63%. The Peruvian Sol depreciated against the dollar when compared to the previous quarter, registering an exchange rate of 3.40 S/$. Furthermore, the inflation rate decreased in 1Q20 down to 1.87%.

Macroeconomic overview

  • The year-over-year growth rate of the Peruvian GDP registered a sharp decrease of 5.21 p.p. during 1Q20 when compared to 4Q19, down to a rate of -3.39% in 1Q20.
  • This contraction in GDP growth was mainly due to both the external and internal demand, for which the year-on-year growth rate fell by 3.18 p.p. to a growth rate of -1.22%. The growth rate of exports experienced a decrease of 14.90 p.p. reaching a rate of -13.58%, while imports fell by 8.10 p.p., registering a growth rate of -6.38%.
  • Regarding the labor market, the unemployment rate stood at 7.06%, increasing by 0.78 p.p. when compared to 4Q19. The year-on-year growth rate of employment in Peru accelerated by 1.07 p.p. from the previous quarter to 1.63%.
  • The average exchange rate of the Peruvian nuevo sol against the US dollar depreciated in the first quarter of 2020 when compared to the one observed in the fourth quarter of 2019, registering an exchange rate of 3.40 S/$.
  • The inflation rate decreased in 1Q20 to 1.87%, 0.01 percentage points lower than in 4Q19.

For more information, click here to access the executive executive document in pdf (only avalaible in Spanish).

© GMS Management Solutions, S.L., 2020. All rights reserved. The information contained on this publication is of a general nature and does not constitute a professional opinion or an advisory service. The data used in this publication come from public sources. GMS Management Solutions, SL assumes no liability for the veracity or accuracy of such data.