Peru's June GDP Growth Slows as El Niño Disrupts Key Sectors

Peru's economic expansion moderated in June, with gross domestic product rising 1.75% year-on-year, according to data released by the national statistics agency INEI. The figure marks a slight deceleration from the 1.8% growth recorded in May, as the El Niño weather pattern continued to exert pressure on the country's primary industries.

The cyclical climate phenomenon, which has warmed Pacific waters and altered rainfall patterns, has driven fish into deeper waters and disrupted agricultural cycles. The farming sector contracted by 8% in June compared to the same month last year, while fishing output plunged by a staggering 52%. Manufacturing also declined by more than 6%, and mining — a critical industry for Peru, the world's third-largest copper producer — fell by over 2%.

Some segments have been hit particularly hard. Olive farmers and anchovy fishermen saw activity levels nearly wiped out, with the latter facing a temporary fishing ban imposed due to weather-driven changes. These declines, however, were offset by strength elsewhere. The construction sector expanded notably, helping the broader economy post a 3.05% growth rate for the first half of the year.

Looking ahead, the government remains cautiously optimistic. Economy Minister Elmer Cuba earlier this month raised the 2026 growth forecast to 3.5% from 3.2%, acknowledging the challenges posed by El Niño. The latest data is the first GDP release since President Keiko Fujimori took office on July 28, a leadership change that ratings agency Moody's has said could boost investor confidence.

In a related move on Friday, Fujimori announced short-term fuel subsidies for cargo and passenger transport drivers, aiming to offset rising costs that have triggered protests in parts of the country.