Peru's dynamic and investment-led economy has proven resilient to a series of internal and external shocks, Moody's Investors Service has affirmed.
Therefore, this will again make it one of the fastest growing economies in the region.
A growing economy will underpin loan growth
While rapid credit growth over the past decade pushed Peru's credit-to-GDP ratio to almost 40% in the first quarter
2018 from 25% ten years earlier, loan growth has slowed to just 3.9% in 2016 and 4.2% in 2017 due to the Car Wash corruption scandal
, Coastal El Niño-related flooding
, and political volatility.
"However, we expect growth to rise to 11% in 2018 and nearly 12% in 2019," it stressed.
The recovery will be driven mostly by consumer, mortgage and corporate lending, while lending to small and medium-sized enterprises will remain subdued.