UPDATE 1-Peru’s economy grows 1.3 percent in Q1 from Q4

(Adds details, background)

LIMA, May 28 (BestGrowthStock) – Peru’s economy grew 1.3 percent in
the first quarter of 2010 from the fourth quarter of 2009,
official data showed on Friday as the country surges to become
a top grower in Latin America this year.

The International Monetary Fund has said Peru’s economy
could grow up to 7 percent this year, along with Brazil.

Peru’s gross domestic product expanded 6 percent from the
first quarter of 2009.

Growth was driven by a booming construction sector and
capital investments that offset a flat mining sector, the
economy’s traditional engine.

Earlier in May, official data showed the economy grew 8.76
percent in March from the same month a year ago.

Recently the government made two coordinated moves to
prevent overheating and inflation.

The central bank raised its benchmark interest rate this
month to 1.5 percent from an all-time low of 1.25 percent,
earlier than most economists had expected [ID:nN06693287],
while the finance minister cut spending increases by about $1
billion. [ID:nN1196393]

Peruvian officials say the economy cannot grow more than 7
percent a year without jeopardizing the central bank’s
inflation target, which ranges from 1 percent to 3 percent.

In 2007 and 2008 inflation accelerated as the economy grew
nearly 10 percent annually on record prices for metals that
Peru exports.

Stock Analysis
(Reporting by Terry Wade and Teresa Cespedes; Editing by Dan
Grebler)

UPDATE 1-Peru’s economy grows 1.3 percent in Q1 from Q4