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4h ago

Velarde Tells Congress Peru’s Economy Is Solid, Urges Stronger Institutions To Cushion Election Cycles

He points to positive 12‑month business expectations that already price in the next government.

Julio Velarde es condecorado con la Gran Cruz de la Orden de la Cámara de Comercio de Lima
Julio Velarde en el Congreso: "Mientras tengamos instituciones sólidas, el efecto de las próximas elecciones será menor"

Overview

  • Presenting to Congress, the BCRP chief highlighted projections of roughly 3.2% GDP growth this year and 2.9% next year with inflation near 1.7%, within the central bank’s target.
  • Velarde said private investment grew 9% in the first half of the year and is expected to post about 6.5% growth for the full year, supported by firmer domestic demand.
  • He argued that market sensitivity to elections stems from institutional distrust, contrasting Peru with Uruguay where policy continuity reduces risk premiums despite higher inflation.
  • Velarde warned that lingering fears about the safety of savings reflect weak rule of law and said stronger institutions would lessen the economic impact of upcoming elections.
  • His message came as the Lima Chamber of Commerce awarded him its Grand Cross and as Fed Chair Jerome Powell publicly praised his commitment to stability, reinforcing confidence in Peru’s policy framework.