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Peruvian economy’s outlook very uncertain, downside risks prevail, says IMF -Breaking

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© Reuters. Surco Market in Lima (Peru), August 31, 2018 – People walking. REUTERS/Mariana Bazo

(Reuters) – The prospects for Peru’s economic outlook are “very uncertain” and there are downside risks, despite a robust rebound in GDP growth last year. This was according to the International Monetary Fund (IMF), which published a Monday report.

IMF stated that Peru would see an increase of 3% in GDP after recording 13.3% growth in 2021. External conditions will tighten, and policy stimulation is removed.

According to the report’s findings, the major risks are the global pandemic and a tightening of financial markets, extended supply chain disruptions in the global economy, geopolitical tensions and a sudden slowdown in Peru’s principal trading partner China.

The IMF stated that “The economic recovery was strong but there are still downward external and internal risks.”

According to the report, Peru continues to face high economic and social costs due to the pandemic.

Concerning Peru’s central bank’s attempts to curb inflation, the IMF noted that “monetary policy has been responding appropriately to rising inflationary tensions. But further tightening may be necessary to bring inflation under check.”

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