Chile Business Confidence


Chile: Business confidence deteriorates further in Q4

January 19, 2015

In Q4, the business confidence index (IEE, Indice de Expectativas Empresariales) produced by the Santiago Chamber of Commerce (Camara de Comercio de Santiago) fell from 52.6 points recorded in Q3 to 51.8 points. As a result of the drop, the index now stands at its lowest level since Q4 2008 and is closer to the 50-point threshold that separates optimism from pessimism. Business sentiment has been mainly affected by the recently introduced tax reform as well as by the deteriorating economic prospects.

The drop in Q4 came on the back of a deterioration in firms’ outlook on the services and industry sectors. On the other hand, firms in the commerce sector were slightly more optimistic compared to the previous quarter. According to the Chamber of Commerce, businesses’ expectations regarding future investment were at the lowest level since Q1 2009, which matched the level observed in the previous quarter. In addition, expectations regarding future sales and expected employment deteriorated over the previous quarter and reached the lowest values on record.

LatinFocus panelists expect fixed investment to drop 4.3% this year, which is up 0.1 percentage points from last month’s forecast. For 2015, the panel sees fixed investment to expand 3.8%.

Author:, Senior Economist

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Chile Business Confidence Chart

Chile Business ConfidenceCCS Q4 2014

Note: Business Confidence Index (IEE, Indice de Expectativas Empresariales). Values above 50 indicate optimistic perception, below 50 indicate negative perception.
Source: Camera de Comercio de Santiago (CCS).

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