Peru’s economy has shown surprising growth in February compared to the previous year, marking a positive sign as the country emerges from a challenging recession. The economy expanded by 2.85% from the same month a year earlier, exceeding most forecasts and surpassing the median estimate of 2.1% growth from a survey of economists. This growth was driven by a 1.19% increase from the previous month and represents two consecutive months of expansion for Peru’s economy on both an annual and month-on-month basis.
The government and central bank are optimistic about the potential for a rebound, aiming for 3% growth in 2024 after a contraction last year caused by political turmoil and adverse weather conditions. In February, mining output played a significant role in driving growth, increasing by 16% compared to the previous year. Despite concerns about inflation, the central bank recently cut interest rates and expressed confidence that inflation will reach 2% in the near future.
However, President Dina Boluarte is facing challenges stemming from her use of expensive Rolex watches, which has sparked an investigation into potential illegal enrichment. While Boluarte maintains that the watches were a loan from a political ally, a recent poll indicated that the majority of Peruvians do not believe her explanation, leading to a decline in her popularity.
