Peru readying bond issuance to underwrite unprecedented stimulus package

By Marco Aquino

LIMA, April 2 (Reuters) - Peru is preparing a majorbond issuance to help underwrite an unprecedented stimulus package to counter the economic impact of the fast-spreading coronavirus pandemic, the country´s central bank president said on Thursday.

Julio Velarde, head of the central bank, said the issuance would lead to a "quite large" fiscal deficit but that the markets viewed the plan favorably. The bonds would be ready in the "near future," Velarde said.

Peru's government said on Sunday it was preparing a massive economic stimulus package equal to about 12% of gross domestic product to boost the economy during and after the pandemic.

The copper-rich South American nation is planning to spend 90 billion soles ($26.41 billion) to support citizens and the key mining sector, Economy Minister Maria Antonieta Alva said on Sunday.

The package will have three phases of 30 billion soles each - containing the disease, ensuring companies' payment chains by granting credit guarantees, and reactivating production in the world's second-largest copper producer, Alva said.

(Reporting by Marco Aquino, writing by Dave Sherwood, Editing by Franklin Paul and Steve Orlofsky)

((dave.sherwood@thomsonreuters.com; +56 9 9138 1047, +56 2 2370 4224; Reuters Messaging: dave.sherwood.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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