During 2Q20, Peru's Gross Domestic Product registered a year-over-year rate of -30.24%, sharply decelerating when compared to the previous quarter. This contraction in GDP growth was mainly due to the fall in the growth of both the internal and external demand, which were severely affected by the containment measures carried out to mitigate the spread of the COVID-19 virus and the prolongation of lockdown measures throughout the quarter. Regarding the labor market, the unemployment rate increased with respect to 1T20, up to 12.80%. The year-over-year growth rate of employment creation in Peru stood at -42.59%. The Peruvian Sol depreciated against the dollar when compared to the previous quarter, registering an exchange rate of 3.43 S/$. Furthermore, the inflation rate decreased in 2Q20 down to 1.70%.

 


Macroeconomic outlook report: Peru 2Q20

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Macroeconomic overview

  • The year-over-year growth rate of the Peruvian GDP registered a sharp deceleration of 26.85 p.p. with respect to 1Q20, reaching a rate of -30.24%.
  • This contraction in GDP growth was mainly due to the fall in the growth of internal and external demand, which were severely affected by the containment measures taken to tackle the COVID-19 pandemic and the extension of lockdown measures. Exports fell sharply to -43.64%, 33.99 p.p. less than in the first quarter, and imports contracted by 24.67 p.p. compared to 1Q20, reaching -30.47%. On the other hand, internal demand decelerated 24.36 p.p., down to a y/y growth rate of -26.67%.
  • Regarding the labor market, the unemployment rate increased by 5.74 p.p. with respect to the previous quarter, reaching 12.80%. The year-on-year growth rate of employment in Peru stood at -42.59%.
  • The average exchange rate of the Peruvian nuevo sol against the US dollar depreciated during the second quarter of 2020 when compared to the one observed in the first quarter of 2020, registering an exchange rate of 3.43 S/$.
  • The inflation rate decreased in 2Q20 to 1.70%, 0.17 p.p. below the value registered in 1Q20.

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