Peru | In July, economic activity continued to show an interesting performance

Summary

Economic activity grew 12.9% year-on-year in July, a still high rate due to a low comparison base. In an analysis that compares the GDP figures for 2021 with those for 2019 (a pre-health crisis situation), what is observed is that in July of this year, activity grew 0.4% (June: 1.1%).

Key points

• Key points:
• The situation is more positive on the non-primary GDP side. The growth of some services such as financial and telecommunications, construction (supported by public investment and self-construction) and, although it loses dynamism in July, non-primary manufacturing stands out.
• On the primary side, there was a relatively marked decline: hydrocarbon production contracted due to a technical problem at the natural gas liquefaction plant in Pampa Melchorita, which affected the production of natural gas and natural gas liquids.
• The activity data for July and the indicators available for August (electricity production and internal cement consumption) suggest that GDP continues to show resilience in the third quarter.
• In the labor market, the gradual improvement in employment appears to be losing momentum. In July, the number of formal jobs nationwide (electronic spreadsheet) continued to approach its pre-pandemic levels, albeit more timidly.
• In summary, activity continued to show a significant growth rate in July. This performance that we have been observing gives an upward bias to our GDP growth forecast for 2021. However, the recovery also seems to lose steam month after month, which together with the deterioration in confidence, is more in line with the slowdown we anticipate for GDP from the fourth quarter onwards.

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