July 15, 2013 / 6:12 PM / 6 years ago

UPDATE 1-Peru's economic growth slowed more than expected in May

LIMA, July 15 (Reuters) - Peru’s economy slowed more than expected to grow 5 percent in May from the same month a year ago, official data showed on Monday, as surging domestic demand mellowed and mineral exports continued to slump.

Economists surveyed by Reuters had forecast 5.4 percent expansion in May. Last year in May the economy grew 6.47 percent.

Peru has enjoyed an average annual growth rate of 6.5 percent over the past decade.

May’s relatively moderate growth follows April’s 7.65 percent surge and the weakest first-quarter expansion since 2009, which prompted President Ollanta Humala to vow to boost investments.

May growth was led by construction, which expanded 10.5 percent compared to the same month last year - less than half of that sector’s expansion in April, according to Peru’s statistics agency.

Retail activity grew 6.6 percent in May and the mining and hydrocarbon sector expanded 5.9 percent. Manufacturing rose just 1 percent and fishing fell 19.8 percent.

The central bank and government expect the economy to expand around 6 percent this year, but some private-sector economists have trimmed their forecasts.

Peru is a top global producer of copper, silver and gold, but its mineral exports have slumped on weaker metal prices and softer global demand. Domestic demand now leads growth.

On Friday, Peru posted a $465 million trade deficit for May, the biggest monthly deficit on record and only slightly wider than April’s trade gap.

The average unemployment rate in Lima was 5.8 percent in April May and June, the statistics agency said.

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