LatinNews Daily - 6 November 2024

*International credit ratings agency Fitch Ratings has maintained Peru’s long-term foreign-currency and local currency issuer default rating (IDR) at ‘BBB’ and raised its outlook to stable from negative. The credit ratings agency said this change resulted from “sound policymaking [which] has supported an economic recovery this year and preserved broad macro-financial stability” after “heightened political volatility… drove an economic recession last year”. Nonetheless, Fitch noted that “political uncertainties remain elevated” and was expected to “keep growth relatively weak at around 2.5% over the next two years”. Fitch predicts Peru’s GDP growth to recover to 3.0% this year after the economy contracted 0.6% in 2023, reflecting the recovery of the agricultural and fishing industries, an increase in copper prices, and lower inflation levels. “Activity will be buoyed by the completion of large infrastructure projects (e.g. Lima airport), and favourable global demand for minerals,” Fitch added. Fitch’s decision comes after credit ratings agency Moody’s raised its outlook on Peru from negative to stable in September, while maintaining its long-term foreign currency and local issuer credit rating.