The Peruvian Sol continues to fall vs the US Dollar as trade imbalances and a slowing economy pressure the currency.
Great for visitors, hard on those who have borrowed in dollars.
Via El Comercio Peru:
Continue reading Peruvian Sol falls to 3.20 vs the US Dollar
According to a recent article in Gestion Peru, the amount of foreigners applying to work in Peru has increased by over 800% in the last decade. With economic growth rates that were the envy of most of the world until recent years, Peru has attracted workers from all over the world particularly in other South American countries, and Spain which is suffering from high unemployment, especially among the youth population.
Via Gestion Peru (Google translate with authors corrections for clarity)
Continue reading Number of Foreigners Coming to Peru for Work Grew 800% in the Last Decade
A long dreamed railroad connecting the Atlantic coast of Brazil to the Pacific coast of Peru may finally become a reality. Meanwhile economic news is mixed in Peru. The dollar has remained relatively stable vs the Peruvian Sol lately, but it may just be a pause before the dollars rise again according to Charles Hugh Smith of the Of Two Minds Blog.
Continue reading Peru Economic News Mixed, A Railway from Atlantic to Pacific?
Peru News
Fresh Peruvian Asparagus & Blueberries will be exported to the US according to a recent article in El Comercio. Both countries are developing systems to mitigate the risk of pests such as the fruit fly and allow more a more open process for exports to the US.
Continue reading Peru News Roundup
One casualty of the skyrocketing costs of housing in Lima is migration from the provinces. For many years, there had been a steady flow from the outlying areas to Lima. A new study shows that the trend has reversed & other areas outside of the capitol are now more attractive to migrants looking for economic growth & opportunity.
Continue reading Migrating to Lima no longer attractive for many
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Peru’s explosive housing market is showing a decline as inventory increases. As I’ve mentioned in these pages before, the amount of debt in dollars is weighing on the marketplace, and the overbuilt market is screaming “bubble.” Furthermore, as many new units are set to come on the market in the next year, expect declines in prices as builders realize that they have to sell something in order to keep up with debt service. The construction sector has been a big employer in recent years both through construction jobs & all of the ancillary services and products related to housing. As construction slows, so will the overall economy.
Continue reading Lower Home Sales Portend Slowing Economy in Peru
With the Peruvian Sol declining in value, the Central Bank of Peru is keeping the current rate of 3.25% in place for now, mainly to avoid further weakening of the currency.
From Bloomberg:
The rapid descent of the Peruvian Sol is affecting consumers in Peru. While the US is seeing official rates of inflation below the Fed target of 2%, Peru is paying a lot more for imported products including appliances because of the decline in the national currency the Peruvian Sol.
Continue reading Peruvian Sol Breaks Psychological $3.10 Barrier, Inflation in Appliances
Depending on who you talk to or read these days, the Peruvian economy is robust, or slowing. While officials remain upbeat & expect economic growth to be close to 5%, they missed the mark by nearly half last year. (see Why the Peruvian Economy Matters to the World) While the continued decline of the Sol vs the USD is supportive of export growth, the fact that 50% of all debt in Peru is denominated in dollars will offset any gains from a lower national currency.
