Peru Q2 growth accelerates, helped by mining output

Peru's GDP expanded at a faster pace in the second quarter as minerals and electricity production rose and fishing, banking and telecommunications also helped offset falls construction and manufacturing output, the government said.

GDP grew 3% in the second quarter compared with 1.8% and 1% in the previous two quarters, Peru's national statistics office said in a report.

Metallic mining output rose 13.7% in the quarter from a year earlier as lead and zinc gained 12.8% and 8.8%, respectively, the agency said. Molybdenum output rose 41.8%, while copper was up 18.7% and gold climbed 10.4%. Iron ore fell 10.8%, while tin dropped 7.8% and silver slid 2.9%.

Consumer demand rose 3.3% in the quarter, while public spending increased 6.3%, the agency said. Construction activity shrank 8.7% due to a 21.6% decline in road-building and 30.3% in government civil engineering works. Exports and imports fell 3.2% and 4.8% in the quarter, respectively.

Peru's government, which has awarded US$18bn in public-private partnership concessions, expects economic growth to accelerate this year as work starts on infrastructure projects and companies complete new mines and expansions.

"Peru's GDP continued with its recovery process mainly supported by the favorable evolution of primary activities, especially mining," Inteligo SAB analyst Fernando Iberico wrote in a report. "We expect domestic activity to gradually rise up, benefited by higher local mining production and better performance of public investment during the second half."