Peru Grows 3.23% as Consumer Credit, Public Works Surge

Peru’s economy grew 3.23% in August from a year earlier, the national statistics institute INEI said Thursday, October 15. But public works and borrowing by consumers powered the expansion as the country’s mining base contracted. Growth eased from July’s 3.56%.

The headline figure held up. Output rose 3.14% from January to August and 3.31% over the 12 months to August. Seasonally adjusted output added 0.22% from July. A year earlier, growth stood at 2.80% on INEI’s current revised series.

What Drove the Expansion

Construction grew 10.34%. Cement consumption rose 7.63%, while public works jumped 19.33%. That’s a sizeable government-spending footprint in the month’s strongest sector.

Commerce gained 6.89%, led by car sales, which climbed 25.73% as financing and vehicle fairs helped buyers. Consumer loans at commercial banks reached S/ 89.5 billion, about US$26.0 billion, up 15.9%. New light-vehicle sales rose 44.7% to 23,412 units. Consumer-goods imports increased 23.1% to US$1.46 billion.

Financial and insurance activity expanded 3.19%, with deposits up 7.91% and credits up 3.98%. Business services grew 3.91%, and government services 3.06%. Electricity, gas and water activity rose 6.61%. Manufacturing added 4.18%, helped by primary precious-metal products, up 89.91% from a low base.

Mining and Energy Stumble

The sectors that earn Peru’s hard currency moved in the opposite direction. Metal mining fell 6.14% and hydrocarbons 1.35%, bringing the mining and hydrocarbons sector down 5.53%. Seasonally adjusted, the sector contracted 3.62% from July.

Copper output dropped 5.3% to about 207,100 tonnes as ore grades declined at Antapaccay. Chinalco, the miner behind Toromocho, carried out minor planned maintenance there, while Cerro Verde and Marcobre also produced less. Southern Peru Copper, the Peruvian arm of New York-listed Southern Copper (SCCO), was among the miners INEI named as recording lower output.

Zinc production fell 28.1% for a seventh straight month as Antamina processed more copper-only ore. INEI said the shift followed the mine’s plan. Silver output dropped 10.4% and gold 0.9%. Molybdenum rose 12.5% and iron 9.2%, together adding 1.10 percentage points to the mining sector’s result.

The timing stings. Average copper prices rose 48.9% from a year earlier to record highs, even as Peruvian copper volumes fell 5.3%. Peru is producing less metal in the strongest price market on record.

Crude oil output dropped 10.85%, its 10th consecutive decline, amid work by operator PetroTal on up to five wells at Lot 95. Fishing fell 17.33%, and anchovy landings for fishmeal declined 58.1% to 2,602 tonnes. The state El Niño commission ENFEN noted that giant squid fishing had been suspended since July 18, INEI said; that’s 90 days as of today. Fresh fish landings rose 11.54%, easing the decline. INEI’s figures were preliminary and based on information available Wednesday, October 14.

Trade and Forecasts

Total exports grew 17.75% on larger shipments, with traditional products up 20.89% and non-traditional products up 10.32%. Central bank trade data put August exports at US$10.8 billion and imports at US$6.1 billion. INEI identified the United States as a market for jewellery, whose output rose 49.3%, and containers and trailers, up 194.43%. Apparel output fell 12.32%; the United States and Germany were named as markets.

The central bank, BCRP, lowered its 2026 growth forecast to 3.2% from 3.4% in September, citing El Niño. A central bank survey showed analysts expected 3.2% growth in 2026. The International Monetary Fund’s October outlook projected 3%, up from 2.8% in April. The central bank’s latest published interbank exchange rate was S/ 3.44 to the U.S. dollar, from October 13.

INEI plans to release September’s output figure on Sunday, November 15, 30 days from now. Whether mining will recover from August’s decline remains uncertain, with Antamina’s ore mix following its mine plan and zinc output down for seven months.

Why This Matters:

A 3.23% print looks healthy, but its composition deserves scrutiny. Growth leaned on a 19.33% jump in public works and a 15.9% rise in consumer lending, while mining, the sector that generates export earnings, shrank 5.53%. State spending and household credit offer a thinner foundation than private investment in production. The copper numbers sharpen the point: record prices and falling volumes mean Peru is leaving money on the table. Sustainable growth depends on whether miners can raise output and whether policy keeps Peru attractive to the capital that does it. Forecasters at 3% to 3.2% for the year aren’t sounding alarms, but they aren’t sounding confident either.