Peru Slips into Chaos: President Declares State of Emergency as Violent Protests Erupt Over Soaring Inflation

It appears that consumers around nearly all parts of the world are feeling the pressures of rapidly accelerating inflation. The latest country to slip into chaos is Peru, where violent protests erupted in the capital city as citizens become fed up with surging fuel and food costs.

On Tuesday, Peru’s President Pedro Castillo declared a state of emergency and imposed a curfew from 2AM local time to 11:59PM in the capital city of Lima and neighbouring port city of Callao. The unprecedented measures are in response to a sudden rise in violent demonstrations staged by truckers and farmers, after consumer prices jumped by an annualized 6.82% last month— the highest since August 1998. Housewives also joined the protests to voice their frustration with rising food costs, with local media cited by Bloomberg showing looted mini-markets across the southern Ica region of Peru.

The protests, which initially began last week over surging fuel and fertilizer costs, temporarily caused food supply disruptions into the capital city. The demonstrations prompted Castillo to slash fuel taxes over the weekend and even hike the minimum wage by 10%; however, that still failed to quell Peruvians’ frustrations, given that many truck drivers are informal employees and do not have fixed wages. On Monday, Peru’s government sent in the military to ease traffic constraints after bus drivers blocked major roadways.

Castillo’s popularity has plummeted even further as of recent, merely weeks after narrowly avoiding an impeachment by the country’s congress. His appeasement attempts to soothe the public’s frustrations with out-of-control inflation are probably not going to help his struggling bid to remain in power though; according to Citi Group strategists, congress will most likely attempt to impeach the president once again. “While the president had the votes to avoid being ousted two weeks ago, a new push down the line might have a different outcome if he loses support of congressional allies.”

Peru’s main agriculture exports, which include avocados, grapes, and blueberries, are now at risk of substantial supply disruptions according to Bloomberg, which cited a statement from the South American country’s association of exporters. The country’s central bank is forecast to raise its policy rate by 50 basis points on Thursday to 4.5%, marking the ninth straight increase in borrowing costs since August 2021.


Information for this briefing was found via Bloomberg. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

2026 Could Be Gold’s Biggest Year Yet!? | Ryan King – Equinox Gold

Gold Is Screaming Higher While Currencies Burn | Simon Ridgway – Rackla Metals

We Have the Highest-Grade Antimony Deposit in North America!? | Jim Atkinson -Antimony Resources

Recommended

Canadian Copper Secures $8 Million Lead Order From Ocean Partners As Part Of Larger Funding Round

Northern Superior Expands Philibert With 350 Metre Step Out Testing 1.10 g/t Gold Over 25.5 Metres

Related News

Tiff Macklem: Bank of Canada ‘Getting Closer’ to Hiking Rates as Economic Conditions Improve

Bank of Canada Governor Tiff Macklem once again reassured Canadians that the central bank is...

Monday, November 15, 2021, 04:44:00 PM

Quebec Hands Out Money… To Fight Inflation

In today’s class on How to Combat Inflation 101, we learn that the best way...

Wednesday, March 23, 2022, 11:17:00 AM

US Producer Prices Accelerate 6.2% in April as Inflation Burns Hot

In another sign that inflation in the US is running red-hot, producers passed down significantly...

Thursday, May 13, 2021, 04:30:00 PM

European Central Bank Significantly Raises Inflation Forecast, Signals More Aggressive Rate Hikes

The European Central Bank has found itself in a very tough spot: with entrenched price...

Sunday, June 12, 2022, 11:12:00 AM

Canadian Inflation Falls to 0.7% in December Amid Renewed Lockdowns

Price pressures for the month of December slowed down across Canada, as much of the...

Wednesday, January 20, 2021, 04:04:00 PM