UPDATE 1-Peru sells 2026 local bonds above par - source

(Updates with average price, analyst comment)

LIMA, Feb 23 (Reuters) - Peru sold 280.5 million soles ($87.9 million) of reopened 2026 bonds on the local market at a price above par, as part of a program to buy back or swap debt, a market source told Reuters on Friday.

Demand for the bonds, which carry a coupon of 8.20 percent, was 827 million soles, the source said on condition of anonymity.

The average price offered was 120.7021 percent of the face value of each bond, worth 1,000 soles each, the source added.

"The average price was above par since it was above 100 percent, which means it has been a good issue for the government," said an analyst who also requested anonymity.

Investor interest in Peru is high after the South American country's economy grew 8 percent last year, the highest rate in 11 years due to booming exports, particularly of minerals.

The Peruvian government last week announced the plan to buy back or swap up to $3.634 billion on domestic and international markets, seeking to improve its debt profile.

The auction results will be released later today.