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PERU: Fitch Says Government Unlikely To Meet 2024 Fiscal Target

PERU
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  • In a report yesterday, Fitch Ratings said that the government will probably miss its revised 2024 fiscal deficit target, due to loose fiscal policies which are supporting the economic recovery. Fitch now forecasts the 2024 fiscal deficit to come in at 3.4% of GDP, above the government’s 2.8% target for this year. Fitch says that this would bring the general government debt-GDP ratio to 32.7%.
  • Fitch expects fiscal revenues to rise on rebounding growth and supportive copper prices, but does not foresee spending cuts to meet fiscal targets. This would mean the government missing its target for a second year running. Fitch noted that continued fiscal slippage could result in a sustained rise in general government debt/GDP over the medium term, adding that the government also faces risks from the possibility of further support to Petroperu, which if material and sustained could be another source of structural fiscal pressure.
    • For the full Fitch report see here. 
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  • In a report yesterday, Fitch Ratings said that the government will probably miss its revised 2024 fiscal deficit target, due to loose fiscal policies which are supporting the economic recovery. Fitch now forecasts the 2024 fiscal deficit to come in at 3.4% of GDP, above the government’s 2.8% target for this year. Fitch says that this would bring the general government debt-GDP ratio to 32.7%.
  • Fitch expects fiscal revenues to rise on rebounding growth and supportive copper prices, but does not foresee spending cuts to meet fiscal targets. This would mean the government missing its target for a second year running. Fitch noted that continued fiscal slippage could result in a sustained rise in general government debt/GDP over the medium term, adding that the government also faces risks from the possibility of further support to Petroperu, which if material and sustained could be another source of structural fiscal pressure.
    • For the full Fitch report see here.