Peru | GDP grows in September below consensus and confirms bump in the third quarter

GDP grew 1.7% year-on-year in September. The decline that primary GDP has been showing steadily in September moderated, with the performance of mining standing out within it. The non-primary component, however, accentuated its tendency to weaken in September

Key points

• Key points:
• By components, the decline that primary GDP has been showing steadily in September moderated, highlighting within it the performance of mining, which stopped showing negative rates in a context in which the Quellaveco copper unit began commercial operations.
• The non-primary component, however, accentuated its tendency to weaken in September, which would be influencing the diminishing positive impact of the "rebound effect" after the sanitary isolation measures were made more flexible and a less favorable environment for spending private.
• With the September result, year-on-year growth in the third quarter would have been 1.6%. Thus, activity would have continued to lose dynamism, since in the second quarter it expanded by 3.3%.
• We estimate that the result for the third quarter will be the lowest of the year. From now on, the performance of the activity will be somewhat more positive as it reflects the entry into the operational stage of Quellaveco, the continued normalization of tourism, and, in the short term, a good performance of public investment. These more positive growth rates will, however, be limited by an increasingly challenging external environment, social unrest around extractive activities, business confidence that is consistently pessimistic, and the dip into which public investment usually falls when new authorities take office at regional and municipal level. In this context, we estimate an expansion of between 2.0% and 2.5% in the last quarter of the year, while in the quarters of 2023 activity would advance at an average rate close to 2.5%.

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