Minister Castilla Says Peru in Good Position to Cushion Volatility from U.S.

Economy and Finance Minister Luis Miguel Castilla said that Peru is in a solid position to cushion volatility from the partial shutdown of the U.S. government, daily El Comercio reported.

“Thank God we have international reserves in the Central Bank, we have a cushion to confront any volatility in the markets and a credit rating that distinguishes us as a country that is very solvent and credible in the world,” Castilla told reporters.

Castilla said that the situation in the U.S. is a concern, but that it is due to political issues and not economic ones.

“In fact, the North American economy is recovering and we’re seeing the increase in the foreign demand from that country in our products,” he said.

Trade on Wall Street dropped by the second day of the shutdown, while national parks closed and several hundred thousand government employees were being furloughed in social assistance programs as well as military bases and other Defense facilities.

The partial shutdown of the U.S. government began Monday after Democrat and Republican lawmakers were unable to agree on a new budget. Republicans in the House of Representatives refused to approved the budget without a year’s delay on the implementation of President Barack Obama’s healthcare reform, a condition that wasn’t accepted by the Democrat-controlled Senate.  The Affordable Care Act went into effect on Tuesday.

Peru’s Castilla said that there will likely be instability in the financial markets as the impasse continues and as another deadline on raising the U.S. debt ceiling approaches later this month.

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