Peruvian business community's optimism strengthens in July

The Peruvian business community is more optimistic about the outlook for the local economy and hopes the positive trend will continue despite the criticism and low approval of President Dina Boluarte.

At the end of July, all categories of business measured by the central bank’s latest survey – the economy, sector outlook, company situation, product demand, personnel hiring, and investments within companies – were in positive territory both in the short-term (three months) and in the medium-term (12 months) perspectives, indicating a structural recovery of the economy is coming and not just a rebound effect.

All the indicators exceeded 50 points on a scale from 0 to 100 and certain medium-term categories are close to 60 points. The survey was with 272 local companies in the mining, manufacturing and retail areas, among others.

According to the monetary authority, above 50 points represents optimism and below that level pessimism. 

Expectations (3 months)	May	June	July
Economy	48	50	51
Sector outlook	52	51	52
Company situation	51	52	53
Product demand	55	55	56
Recruitment	49	51	51
Investments within the company	49	50	51

Source: BCRP

Only in March did the three-month outlook for the economy move into optimistic territory, rising from 47 to 51 points for the first time since March 2021, although it did dip back into negative mode briefly in May.

According to statistics office INEI, various economic indicators again showed an improvement in July – electricity production, fishing and mortgages, among others. As a result, Q2 GDP growth is expected to be much higher than the 1.4% in Q1.

The central bank forecasts 2024 GDP growth of 3.1% but there is a possibility that it will be revised upwards.