Grand Travel

Peru is one of the emerging countries with lower inflation than its trading partners, which contributes to improving the country's exchange rate competitiveness, Scotiabank said Saturday.

According to Scotiabank, Peru's inflation rate is two percent so far this year compared to the average 2.7 percent of its trading partners.

"In this way, lower inflation suggests that domestic firms face a smaller increase in costs than their foreign competitors," says Scotiabank analyst Mario Guerrero.

He said that export prices have recovered quickly after the fall recorded in 2008, jointly reaching a new record high of 23 percent growth over the last twelve months.

"While this increase in prices is determined largely by rising prices of mineral commodities, the prices of non-traditional exports also recorded a significant increase of nine percent in the last twelve months," Guerrero said in the bank's weekly report.

The traditional export volume increased by only 2.8 percent during the last twelve months, due to the slow recovery of global demand, however, the volume of non-traditional exports grew six percent in that period.

The multilateral real exchange rate of Peru posted a 4.9 percent drop over the last twelve months, as well as a 9 percent drop and 10 percent decline in the last two and five years, respectively.