| 12 April 2024, Friday |

Peru mired in uncertainty as hopes of moderate administration dims

After newly-elected Socialist President Pedro Castillo appointed hard-left Marxist as prime minister bonds tumbled on Friday and the local currency weakened.

Guido Bellido was named prime minister, dimming hopes of a moderate administration, while the key post of finance minister remained vacant. Most of the rest of the cabinet was also sworn in, but the lack of an economy czar is likely to create uncertainty in markets already rocked by a campaign in which Castillo called himself a Marxist-Leninist.

Castillo, who took office on Wednesday, took to Twitter in the early hours of Friday to defend his new government.

“Our cabinet belongs to the people. It answers to the people,” Castillo said on Twitter at dawn, defending his government team.

“Our commitment is with Peru and with no other interest than to dedicate each and every one of our efforts to build a more just, free and dignified country. We will not disappoint your trust,” he tweeted.

Castillo’s failure to appoint a finance minister exacerbated those concerns, JPMorgan said in a note.

The local sol currency lost over 3% to the dollar in early trading in Lima, while Peru’s dollar bonds slid.

  • Reuters