In August, the fiscal deficit accumulated in the last 12 months represented 4% of the Gross Domestic Product (GDP), a level similar to those recorded in the last four months, revealed the Central Reserve Bank (BCR).
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“The non-financial public sector recorded an economic deficit of S/ 6,058 million, while in the same month of 2023 it was S/ 5,282 million, mainly due to the increase in non-financial expenses of the general government, at all levels of government, and in all expenditure items with the exception of current transfers,” the monetary entity stated.
The issuing body also indicated that the non-financial public sector accumulated a deficit of S/18,276 million.
In this regard, the Central Manager of Economic Studies at the BCR, Adrián Armas, said that next week they will provide details on whether the deficit projection for next year will be modified.
It should be noted that the Ministry of Economy and Finance’s goal is to achieve a 2.8% deficit by the end of the year; however, Fitch Ratings recently warned that there is a risk that this goal will not be met.
“Looser fiscal policies to support economic recovery amid political instability mean the country is likely to miss its fiscal target,” the rating agency said, estimating that the target will reach 3.4% of GDP by 2024, meaning the fiscal rule would not be met for the second consecutive year.
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