Morgan Stanley Revises Peru GDP Forecasts

Morgan Stanley has reduced its 2009 GDP growth prediction for Peru to 0.9% from 1.8%, but increased 2010’s forecast to 4.9% from 4.4%. The shop says that this year, “the economy has proven less dynamic than we had expected, lagging some of its neighbors in pulling out of the downturn. Sequentially Peru has contracted 0.5% in H109, underperforming Brazil (up 0.5%) and Colombia (up 0.5%).” Next year, it believes Peru will post one of the strongest rebounds in LatAm as private investment rebounds. “For 2009 we expect $3.5bn in FDI inflows – an equivalent of near 3% of GDP – . . . in line with the 3.3% of GDP average FDI inflow in the last 10 years,” the shop says adding that for 2010 it expects FDI to increase to at least $5.7bn, or about 4.0% of GDP. Morgan Stanley also improved its 2009 PES forecast to PES2.85 per USD from PES3.2 previously. In 2010, it changed it to PES2.8 per USD from PES2.9.