Chile Economic Outlook
January 21, 2020
The economy likely contracted in the fourth quarter after widespread demonstrations rocked the country at the end of last year. Declines in economic activity in both October and November hint that GDP contracted for the first time in two-and-a-half years in Q4, with household spending and fixed investment likely taking the brunt of the unrest as suggested by record-low consumer and business confidence. The external sector was seemingly less affected, however, as plunging merchandise imports led to a higher trade surplus in the quarter. On 13 January, the government valued the infrastructure damages caused by the unrest at USD 1.4 billion, while also disclosing details of a tax reform which should partly compensate for fiscal concessions to protesters. The overhaul, which is yet to be approved by Parliament, contemplates tax hikes for high earners and additional progressive taxes on real estate assets.Chile Economic Growth
Prospects for this year have deteriorated since the wake of the protests in October. While fiscal concessions should uphold private consumption, fixed investment is likely to decline as the uncertainty surrounding the drafting of a new constitution deters business activity. Meanwhile, exports are seen rebounding as easing trade tensions support copper prices. FocusEconomics panelists see GDP expanding 1.7% in 2020, which is down 0.5 percentage points from last month’s forecast, and 2.5% in 2021.Chile Economy Data
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Chile Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | 3.14 | -0.44 % | Dec 30 |
| Exchange Rate | 752.0 | 0.05 % | Jan 01 |
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Chile Economic News
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Chile: Inflation rises to two-and-a-half-year high in January
February 7, 2020
Consumer prices rose 0.6% over the previous month in January, accelerating from December’s 0.1% uptick.
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Chile: Economic activity recovers in December
February 3, 2020
In December, the IMACEC economic activity index grew 1.1% on an annual basis, rebounding from November’s 3.3% contraction and beating analysts’ expectations. December’s bounce reflected a 3.7% expansion in the mining economy, contrasting a 5.1% dive in November.
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Chile: Coronavirus hits copper prices in January
February 3, 2020
Copper prices fell in January as the escalation of the coronavirus outbreak hindered Chinese manufacturing activity.
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Chile: Business sentiment rises in January
February 3, 2020
The business confidence index (IMCE), published by ICARE and the Adolfo Ibáñez University, rose to 40.7 points in January from 32.5 points in December.
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Chile: Central Bank stands pat in January
January 29, 2020
At its meeting ending 29 January, the board of the Central Bank of Chile (BCCh) unanimously decided to keep the monetary policy rate at 1.75%, as it seeks to preserve an expansionary stance to support the country’s stunted economy in the aftermath of months of protests.
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