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IMF Executive Board Concludes 2026 Article IV Consultation with Peru
May 18, 2026
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IMF Communications Department
MEDIA RELATIONS
PRESS OFFICER: Jose Luis De Haro
Phone: +1 202 623-7100Email: MEDIA@IMF.org
Washington, DC: The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation[1] with Peru on May 15, 2026.[2]
Record-high terms of trade (TOT) supported strong economic growth in 2025, bringing output close to potential. Employment, income, and consumer confidence improved, boosting private consumption. Private investment rose strongly, supported by metal prices and progress with infrastructure projects. The BCRP continued monetary policy normalization, with inflation expectations firmly anchored and inflation around the midpoint of the target band. The current account surplus grew to 3.1 percent of GDP, while the fiscal deficit narrowed to 2.2 percent, meeting the fiscal rule’s target but remaining high in structural terms.
Growth is projected at 2.8 percent in 2026, assuming limited effects from a short-lived Middle East conflict. A strong labor market and rising real incomes should support private consumption despite some electoral period challenges. Favorable metal prices are likely to boost potential growth, with credit growth set to recover moderately. Higher energy costs will mainly impact transportation and food, temporarily pushing inflation above the upper limit of the target range. The current account is expected to stay in surplus in 2026 before gradually moving to a deficit, reflecting normalizing terms of trade and rising private investment. The fiscal deficit is projected to reach 2 percent of GDP, remaining above fiscal targets in the medium term, while public debt would stabilize around 32 percent of GDP.
The balance of risks to the outlook is tilted to the downside, but Peru retains strong buffers against shocks. Key domestic risks include political uncertainty, social unrest, and weather-related events, while ongoing insecurity and illegal mining may hinder medium-term growth. External risks are primarily driven by spillovers from a protracted Middle East conflict and potential upside inflation pressures. Other external threats include regional geopolitical tensions, protectionism, trade disruptions, commodity price volatility, a disorderly AI correction in financial markets, and prolonged policy uncertainty. On the upside, growth could exceed expectations if high metal prices boost private investment or if greater political stability after the elections enables progress on structural reforms. Peru’s macroeconomic resilience is reinforced by very strong buffers including low public debt, abundant international reserves, and access to international capital markets on favorable terms.
Executive Board Assessment[3]
Executive Directors welcomed the robust growth in 2025, in the context of favorable terms of trade and very strong macroeconomic and institutional policy frameworks. While noting the positive medium‑term outlook, Directors recognized that the balance of risks remains tilted to the downside, including from political uncertainty and spillovers from the war in the Middle East. Accordingly, they underscored the importance of continued prudent policies and accelerated structural reforms to boost potential growth and productivity, while supporting inclusive and sustainable growth.
Directors welcomed the authorities’ commitment to preserving fiscal sustainability. They emphasized the need for fiscal consolidation to achieve the fiscal targets, while creating space for productive public investment and targeted intervention should the global energy crisis escalate. Noting that the structural deficit remains high, Directors encouraged the authorities to address rising spending rigidities, particularly from wage and pension pressures. Measures to improve the quality and efficiency of public procurement and investment are also important. Directors agreed on the need for revenue reforms to help close infrastructure and social gaps. They also encouraged close monitoring of risks arising from the recent reforms to the public‑private partnership framework and pension system.
Directors highlighted that the inflation targeting framework has helped maintain low inflation and anchor inflation expectations. They agreed that a broadly neutral monetary policy stance remains appropriate. In the context of multiple supply shocks and elevated uncertainty surrounding short‑term inflationary pressures, Directors concurred on the need for vigilance and a data‑dependent monetary policy. The flexible exchange rate should continue to play the role of a shock absorber.
Directors welcomed Peru’s financial sector resilience and the authorities’ progress on regulatory reforms. Directors underscored the importance of efforts to promote financial deepening, revive credit growth, and implement the remaining FSAP recommendations. They also stressed that further private pension withdrawals should be avoided to safeguard domestic capital markets.
Directors encouraged the authorities to leverage the opportunity presented by the favorable terms of trade to accelerate structural reforms. Noting the implications for governance, security, and financial integrity, Directors emphasized the need for a coordinated policy response to address illegal mining. They also encouraged efforts to update the fiscal decentralization framework, incentivize formalization, and enhance productivity. Further integrating climate‑related risks into macroeconomic planning and public investment decisions is also important.
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Peru: Selected Economic Indicators |
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Projections |
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2021 |
2022 |
2023 |
2024 |
2025 |
2026 |
2027 |
2028 |
2029 |
2030 |
2031 |
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Social Indicators |
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Poverty rate (total) 1/ |
25.9 |
27.5 |
29.0 |
27.6 |
… |
… |
… |
… |
… |
… |
… |
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Unemployment rate for Metropolitan Lima (average) |
10.7 |
7.8 |
6.8 |
6.4 |
5.9 |
6.3 |
6.3 |
6.5 |
6.5 |
6.5 |
6.5 |
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Production and Prices |
(Annual percentage change, unless otherwise indicated) |
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Real GDP |
13.4 |
2.8 |
-0.4 |
3.5 |
3.4 |
2.8 |
2.8 |
2.8 |
2.8 |
2.8 |
2.8 |
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Output gap (percent of potential GDP) |
1.5 |
1.3 |
-1.5 |
-0.7 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
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Consumer prices (end of period) |
6.4 |
8.5 |
3.2 |
2.0 |
1.5 |
2.5 |
2.0 |
2.0 |
2.0 |
2.0 |
2.0 |
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Consumer prices (period average) |
4.0 |
7.9 |
6.3 |
2.4 |
1.5 |
2.5 |
1.8 |
2.0 |
2.0 |
2.0 |
2.0 |
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Money and Credit 2/ 3/ |
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Broad money |
2.4 |
-0.2 |
2.5 |
11.2 |
7.5 |
8.7 |
8.0 |
7.3 |
6.6 |
5.9 |
5.6 |
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Net credit to the private sector |
6.2 |
3.5 |
0.8 |
0.7 |
3.9 |
7.4 |
7.1 |
7.0 |
6.9 |
6.9 |
6.8 |
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Credit-to-private-sector/GDP ratio (%) |
44.9 |
43.5 |
41.0 |
37.9 |
36.1 |
35.4 |
36.1 |
37.0 |
37.9 |
38.8 |
39.5 |
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External Sector |
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Exports |
47.4 |
5.1 |
1.2 |
13.8 |
21.8 |
18.6 |
1.6 |
-0.7 |
-0.9 |
0.7 |
2.1 |
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Imports |
38.2 |
16.7 |
-10.8 |
4.3 |
12.3 |
12.2 |
3.2 |
4.9 |
4.5 |
4.6 |
4.7 |
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External current account balance (percent of GDP) |
-2.3 |
-4.1 |
0.3 |
2.2 |
3.1 |
3.4 |
2.5 |
1.2 |
0.2 |
-0.4 |
-0.8 |
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Gross reserves In billions of U.S. dollars |
78.5 |
72.2 |
71.3 |
79.2 |
90.3 |
100.1 |
105.1 |
107.5 |
109.7 |
111.8 |
113.8 |
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Percent of short-term external debt 4/ |
57.8 |
509 |
404 |
436 |
540 |
642 |
638 |
737 |
773 |
738 |
755 |
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Percent of foreign currency deposits at banks |
229 |
209 |
204 |
213 |
219 |
225 |
223 |
211 |
201 |
192 |
185 |
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Public Sector |
(In percent of GDP, unless otherwise indicated) |
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NFPS revenue |
25.1 |
26.5 |
23.5 |
22.3 |
22.6 |
22.6 |
22.5 |
22.4 |
22.5 |
22.5 |
22.5 |
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NFPS primary expenditure |
26.1 |
26.7 |
24.6 |
24.0 |
23.1 |
22.9 |
22.8 |
22.6 |
22.6 |
22.4 |
22.3 |
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NFPS primary balance |
-1.0 |
-0.1 |
-1.1 |
-1.8 |
-0.6 |
-0.3 |
-0.3 |
-0.2 |
-0.1 |
0.1 |
0.1 |
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NFPS overall balance |
-2.5 |
-1.7 |
-2.7 |
-3.5 |
-2.2 |
-2.0 |
-2.0 |
-1.9 |
-1.8 |
-1.7 |
-1.6 |
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NFPS structural balance 5/ |
-4.3 |
-2.5 |
-2.7 |
-3.9 |
-3.6 |
-2.9 |
-2.7 |
-2.5 |
-2.2 |
-2.0 |
-1.8 |
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NFPS structural primary balance 5/ |
-2.8 |
-1.0 |
-1.0 |
-2.2 |
-2.0 |
-1.2 |
-1.1 |
-0.8 |
-0.4 |
-0.2 |
0.0 |
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Debt |
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Total external debt 6/ |
46.3 |
42.7 |
39.5 |
37.6 |
34.2 |
30.1 |
29.1 |
27.9 |
26.9 |
25.6 |
24.4 |
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Gross non-financial public sector debt 7/ |
35.5 |
33.5 |
32.4 |
32.1 |
30.2 |
30.0 |
30.9 |
31.6 |
32.1 |
32.1 |
32.2 |
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External |
19.1 |
17.3 |
15.5 |
15.2 |
12.9 |
12.8 |
12.5 |
12.1 |
11.6 |
10.9 |
10.1 |
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Domestic |
16.4 |
16.2 |
16.9 |
16.9 |
17.3 |
17.2 |
18.5 |
19.5 |
20.5 |
21.2 |
22.1 |
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Savings and Investment |
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Gross domestic investment |
22.0 |
22.0 |
19.3 |
19.6 |
20.2 |
20.4 |
20.8 |
21.7 |
22.2 |
22.4 |
22.4 |
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Public sector (incl. repayment certificates) |
4.6 |
4.9 |
4.9 |
5.2 |
5.1 |
4.7 |
4.8 |
4.9 |
4.9 |
5.0 |
5.0 |
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Private sector |
20.1 |
19.9 |
17.6 |
16.8 |
16.7 |
16.9 |
17.2 |
17.3 |
17.4 |
17.4 |
17.5 |
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National savings |
19.7 |
17.9 |
19.6 |
21.9 |
23.4 |
23.8 |
23.3 |
22.9 |
22.4 |
22.0 |
21.6 |
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Public sector |
2.8 |
4.2 |
2.9 |
2.4 |
3.4 |
3.3 |
3.4 |
3.5 |
3.7 |
3.8 |
3.9 |
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Private sector |
17.0 |
13.7 |
16.7 |
19.5 |
20.0 |
20.5 |
20.0 |
19.5 |
18.7 |
18.2 |
17.7 |
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Memorandum Items |
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Nominal GDP (S/. billion) |
892 |
952 |
1,018 |
1,109 |
1,211 |
1,325 |
1,393 |
1,454 |
1,515 |
1,581 |
1,658 |
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GDP per capita (in US$) |
6,923 |
7,431 |
8,086 |
8,666 |
9,911 |
10,960 |
11,008 |
11,360 |
11,699 |
12,087 |
12,550 |
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Sources: National authorities; UNDP Human Development Indicators; and IMF staff estimates/projections. 1/ Defined as the percentage of households with total spending below the cost of a basic consumption basket. 2/ Corresponds to depository corporations. 3/ Foreign currency stocks are valued at end-of-period exchange rates. 4/ Short-term debt is defined on a residual maturity basis and includes amortization of medium and long-term debt. 5/ Adjusted by the economic cycle and commodity prices, and for non-structural commodity revenue. The latter uses as equilibrium commodity prices a moving average estimate that takes 12 years of historical prices and 3 years of forward prices according to the IMF's World Economic Outlook. 6/ Includes local currency debt held by non-residents and excludes global bonds held by residents. 7/ Includes repayment certificates and government guaranteed debt. |
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[1] Under Article IV of the IMF's Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country's economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board.
[2] Under the IMF's Articles of Agreement, publication of documents that pertain to member countries is voluntary and requires the member consent. The authorities have requested additional time to decide on the publication of the staff report. A final decision is expected not later than 28 days from the Board consideration date.
[3] At the conclusion of the discussion, the Managing Director, as Chairman of the Board, summarizes the views of Executive Directors, and this summary is transmitted to the country's authorities. An explanation of any qualifiers used in summings up can be found here: http://www.IMF.org/external/np/sec/misc/qualifiers.htm.
