The
World Bank on Tuesday raised its economic growth projection for Peru to 2.9% for the current year; in its previous January report it had estimated a 2.5% rise for Peruvian economy.
"Growth in Peru is projected to rebound to 2.9% in 2024, then ease to 2.6% in 2025," reads the latest
Global Economic Prospects report.
The World Bank added that Peru's "inflation is expected to continue declining as weather-related increases in food prices dissipate."
"This would allow further policy rate cuts, supporting private consumption in 2024 and 2025," it noted.
"Investment, however, is expected to recover only slowly from its fall in 2023, as political uncertainty weighs on business confidence," the World Bank explained.
Regarding the mining sector, it noted that "although the price of copper is projected to moderate in 2024, increased mining production will support export growth."
Recent developments
According to the document, growth weakened across the LAC region in the last quarter of 2023 as the effects of previous monetary hikes followed through.
"Although recent indicators suggest activity has firmed in early 2024, the improvement has not been broad-based across the region," it said.
According to the World Bank, activity indicators showed partial rebounds in some countries during the first quarter of the year, whereas regional trade remains weak.
Business confidence has remained positive in Brazil and Mexico. It has improved in Colombia and recovered in Argentina after deteriorating strongly in the first months of the year.
Purchasing managers' indexes have indicated improving activity in Brazil and Mexico.
Monthly economic activity indicators in Chile and Peru have also been positive.
Global economy
The global economy is expected to stabilize for the first time in three years in 2024, but at a level that is weak by recent historical standards, the
World Bank said in a
press release.
"Global growth is projected to hold steady at 2.6% in 2024 before edging up to an average of 2.7% in 2025-26. That is well below the 3.1% average in the decade before COVID-19," the multilateral organization indicated.
"The forecast implies that over the course of 2024-26 countries that collectively account for more than 80% of the world's population and global GDP would still be growing more slowly than they did in the decade before COVID-19," it added.
Overall, developing economies are projected to grow 4% on average over 2024-25, slightly slower than in 2023, it stated.
Editor's note: Story based on information issued by the World Bank.
(END) NDP/MVB
Published: 6/12/2024