S&P pares Peru

S&P said it pared Peru’s long-term foreign-currency sovereign credit rating to BBB from BBB+.

“Our sovereign credit ratings on Peru are based on its limited fiscal and external imbalances and a still-low debt burden, albeit higher than pre-pandemic and with a more vulnerable composition, that helped the sovereign manage the impact of the pandemic and recent recession. We weigh these strengths against lower GDP per capita than many of the countries in the region and similarly rated peers,” the agency said in a press release.

Additionally, S&P noted the “prolonged period of political instability due to continued tensions between the executive and legislative powers,” weakening the capacity to execute policies to maintain growth in the medium term, which weighs on investor confidence.

The outlook is stable.

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