Peru | Castillo risks are more in the optics than the agenda
President-elect Pedro Castillo will struggle to pass legislation in Peru’s fragmented Congress, meaning the proposals that markets most worry about are unlikely to become reality.
What you will learn:
- But if he fails to regain investor confidence, the economic damage could be severe.
- Should private sector confidence remain low next year, taking the sol to 4.50/$1 in 2022, per capita income would take another year to recover its prepandemic level.
- Meanwhile, external debt would shoot up to a 20-year high, squeezing the balance sheets of households, firms, and the government.
Tags:
Related Services

Post
Nordics: Key themes 2024 – Light at the end of the tunnel
We forecast no rate cuts by the Fed up to and including the July meeting, while the market prices 72bps. We therefore see value in paying July FOMC-dated Fed Funds swaps, currently trading at 4.61%.
Find Out More
Post
Emerging Markets forecast issues – Policy easing faces stronger headwinds
In our latest monthly forecast, we raised our aggregate 2023 GDP growth forecast for emerging markets (EMs) by 0.1ppt to 4.1%. We raised our 2023 GDP growth forecast for China by 0.1ppt to 5.2% after a slight outperformance in Q3, consistent with the official growth target of “around 5%". We maintain our 2024 aggregate EM growth forecast at 3.6%.
Find Out More