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LatinNews Daily - 28 May 2021

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In brief: IMF maintains Peru’s eligibility for flexible credit line

* The International Monetary Fund (IMF) has concluded a mid-term review into Peru’s continued eligibility for flexible credit line (FCL) resources, and determined that the country can continue to draw on a two-year US$11bn FCL that was approved in May 2020. This enables the Peruvian government to continue borrowing from the FCL without those loans being conditioned to policy targets. The IMF’s deputy managing director, Mitsuhiro Furusawa, said that the decision was based on “Peru’s very strong macroeconomic policies and institutional policy frameworks and solid track record of prudent policy”. Furusawa noted that “the FCL agreement, along with sizeable international reserves, low public debt, anchored inflation, and a sound financial system have provided the authorities with valuable insurance in a period of unprecedented uncertainty and volatility” amidst the coronavirus (Covid-19) pandemic.