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In 2025, the current account deficit would increase slightly due to a larger trade deficit driven by strong domestic demand, which lifts imports while exports grow only moderately. Remittances and a moderate primary-income deficit would partly offset it, and FDI would continue to finance it.

In the second quarter of 2024, the current account deficit stood at 1.6% of GDP, the lowest level since 2009. FDI fell to 2.75% of GDP, though it was sufficient to finance the deficit. The deficit is expected to close 2024 at around 3% of GDP.

The Current Account of the BoP includes the trade balance and the net dividend and interest payments abroad. A current account deficit implies that the country is a net debtor to the rest of the world. An econometric model is used to estimate the structural Current Account balance of Argentina and its long-term determinants

It is important to understand what was going on in the past year’s BoP abnormalities and to predict this year’s BoP items while investigating the sustainability of these abnormalities.

In contrast to the current account deficit recorded in the third quarter of 2019, this indicator showed a surplus of USD 17.498 billion in the third quarter of 2020, mainly due to the much higher positive balance on non-oil goods.

The data corresponding to the third quarter shows a smaller output contraction in line with the recovery following the pandemic, higher public deficit due to the fiscal effort to mitigate the impact and a lower current account deficit.

Economic growth will continue to be led by investment in view of the expected stabilisation in consumption spending. We estimate GDP growth in 2019 and 2020 will be at 3.0% each year and inflation at 3.3% and 3.2%, respectively. The Central Bank will keep its interest rates stable for a long time.

For 2018 we foresee GDP growing by around 3.5% (and 3.8% in 2019). The increase of just over a percentage point in growth will come about in a context in which the international panorama continues to be favourable for the Peruvian economy. On the domestic front, as well as the return to normal of weather conditions, there will be a fiscal stimulus.