Fitch Turns Peru Positive

Fitch changed the outlook on Peru’s BBB minus ratings to positive from stable to reflect the sovereign’s healthy growth trajectory, which is supported by the sovereign’s disciplined macroeconomic policies. Fitch expects Peru’s growth to reach at least 6% in 2010 due to the global recovery and the residual effects of accommodative policies. This compares with Fitch’s BBB median growth forecast of 3.7% during the same period. IMF MD Dominique Strauss-Kahn last week said Peru sets an example to other EM of how to reach a fast track of growth and poverty reduction by carrying out strong economic policies. “With a recovery underway that will see growth in Peru of between 6%-7% this year, the challenge now is to manage success by continuing the timely and gradual phasing out stimulus and avoid the build-up of inflationary pressures, which hit the poor hardest,” Strauss Kahn said, following a trip to Lima.