Keiko Fujimori’s First Five Weeks and Peru’s 21.6% Rally
Economy · Peru
Key Facts
- —The president Keiko Fujimori won a narrow runoff on 7 June 2026 and was sworn in on 28 July, her fourth run for the job.
- —The start Five weeks in, she has 60% approval in the first poll of her term and a market-friendly cabinet.
- —The markets Lima’s BVL stock index is up about 21.6% this year to 3 September, among the world’s strongest.
- —The signature project A US$20.6 billion plan for four new Lima metro lines is her biggest promise so far.
- —The catch Early approval and a hot stock market are not proof of success — they are a test still running.
Peru has had seven presidents ousted by Congress in the past decade. Keiko Fujimori is only five weeks into her term, and markets have already reacted warmly.
The mandate nobody predicted
Fujimori lost runoffs in 2011, 2016 and 2021, the last by fewer than 50,000 votes out of over 18 million cast. Her win on 7 June 2026 completed a comeback few expected.
She inherited a country worn out by improvisation. Between 2016 and her inauguration, Congress removed or forced out six presidents, most recently José Jerí in February 2026.
An interim president, José María Balcázar, held office until Fujimori’s swearing-in on 28 July. Peru’s economy kept growing through all of this turnover.
The market verdict
The S&P/BVL Peru General Index, Lima’s main stock gauge, rose about 21.6% in 2026 through 3 September. Analysts point to fiscal discipline, mining-friendly policy, and hope that the revolving door of presidents has stopped.
Her cabinet was announced on 27 and 28 July, led by Prime Minister Luis Galarreta and Economy Minister Elmer Cuba. Cuba is a former director of Peru’s central bank, part of the market-friendly circle that steadied the country’s finances through the chaos.
Concrete, then credentials
Peru’s state investment agency, ProInversión, put the cost of four new Lima metro lines at more than US$20.6 billion. The government unveiled the plan on 5 August, promising jobs and shorter commutes for a capital of more than ten million people.
It is also a test of whether the state can still build things. In mid-August, flooding overwhelmed drains in Villa El Salvador, a southern Lima district, and forced her hand.
Fujimori responded by ordering a restructuring of Sedapal, the state water utility.
This kind of unglamorous response will decide whether her approval survives its honeymoon.
The Milei axis
On her inauguration day, Fujimori met Argentina’s president, Javier Milei, and the two agreed to deepen cooperation on trade, security and technology. No formal treaty was signed.
For Peru, closer ties mean investment promotion and a friendly neighbour on regional mining questions. For Milei, a meeting with a fellow market-friendly leader is validation of his own approach.
The risks the rally ignores
Congress remains fragmented and transactional, and it has already ousted seven presidents in a decade. Fujimori’s party does not hold a majority, and her father’s record still divides opinion in parts of the country.
The bigger risk is that expectations are outrunning results. A 21.6% stock rally and 60% approval are not achievements — they are a head start that can still be lost.
What to watch
Peru’s 2027 budget, now moving through Congress, is the first real test of Fujimori‘s ability to manage lawmakers. Mining permits and any move on the central bank’s independence complete the list.
Congress has punished nearly every recent president. Her first five weeks suggest she has studied what went wrong for the rest.
The informal economy is her real opposition
Seven in ten Peruvian workers earn a living outside the formal economy, according to INEI, the national statistics institute. They do not track bond spreads; they track bus fares, market prices, and whether police protect their stalls or ignore them.
Fujimori’s 60% approval score lives mostly in this world, not on the stock exchange. Her early focus on water and transport is a sign her government knows where its support actually comes from.
Mining: the promise and the permit queue
Peru is the world’s second-largest copper producer, after Chile. Keeping that rank depends on unblocking stalled projects without reigniting the community conflicts that stopped them before.
Her first weeks brought supportive language from the Energy and Mines Ministry. Whether that becomes real permits, rather than talking points, is still unproven.
Congress: the permanent threat
Congress removed two presidents in the ten months before Fujimori took office — Boluarte in October 2025, then Jerí in February 2026. Her party lacks a majority, so her agenda depends on the same horse-trading that ended her predecessors.
Her one advantage is that lawmakers, too, have been damaged by the churn. For now, both sides need the other to look functional.
The regions versus Lima
The capital votes and invests; the south produces copper and carries the grievances. A CPI poll taken 25-28 August put her approval at just 31.3% in the south.
In the north it was 64.2%, and in Lima 59.4%.
The metro plan and the Sedapal intervention are Lima-focused projects. How the 2027 budget treats the regions will show whether her government sees that gap.
The name she governs under
Every Fujimori campaign carries her father’s record. Alberto Fujimori ruled Peru through the 1990s and defeated hyperinflation and the Shining Path insurgency.
He was later convicted of human-rights crimes. He died in September 2024.
Keiko has spent two decades arguing she is her own politician. Her early record — a technocratic cabinet, market-friendly rules — is a start on that case, not yet its proof.
The score so far
By Peru’s low bar — a government that survives and holds together — her start ranks among the best in a decade.
By the country’s harder problems — extortion, an overloaded judiciary, a mostly informal economy — very little has changed yet.
Markets have delivered their early verdict. The public’s verdict, and the real one, will take longer and will be decided outside Lima’s financial district.
Security in the extortion cities
Extortion, not ideology, is Lima’s most visible problem. Peru’s public prosecutor’s office logged more than 13,800 extortion complaints nationwide between January and July 2026.
Transport firms, market traders and small builders are hit hardest.
Her government’s response so far has been mostly administrative: reshuffled police commands and promises of more prosecutors. Whether complaints fall before the honeymoon ends is the real test.
The water and the floods
Flooding hit southern Lima in her first weeks, a crisis no campaign had planned for. Drains overflowed in Villa El Salvador, and images of the failure spread quickly online.
Her response — ordering Sedapal restructured — was unglamorous and fast. Water in Lima’s hillside neighbourhoods is where the state meets the informal city, and where real approval is quietly built or lost.
Peru’s mining industry, coastal farms and capital all draw on the same stressed river basins. No metro line fixes that problem on its own.
If her first five weeks held one rehearsal for the harder years ahead, this was it. It was a basic service that must simply work, in a country whose institutions have struggled to make that happen.
Connected Coverage
Keiko Fujimori Government Starts Strong: 60% Approval, Pro-Market Team
Fujimori Government Unveils US$20.6 Billion Lima Metro Shock
Milei-Fujimori Cooperation Vows Trade, Security Push
The Big Picture
More from the Peru section
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error
Read More from The Rio Times