Chile: Business confidence slips to a year-to-date low in August
September 4, 2018
The business confidence index (IMCE, Indicador Mensual de Confianza Empresarial) published by ICARE and the Universidad Adolfo Ibáñez fell from July’s 52.2 points to 50.8 points in August, marking the lowest reading this year so far. The index, however, remained just above the crucial 50-point threshold that separates optimism from pessimism among businesses, where it has been since January. In August, for the first time this year just two out of the four sectors surveyed were in positive territory.
The overall fall in confidence was driven by a significant deterioration in the commercial sector with sentiment down markedly from July to August amid worsening expectations of future sales and the general business environment. Nevertheless, sentiment in the commercial sector, together with the mining sector—where confidence remained broadly stable from the previous month—remained entrenched in positive territory in August.
Meanwhile, sentiment in the construction sector slipped deeper into negative territory in the surveyed month as demand conditions weakened. Lastly, the industrial sector saw confidence slip below the critical 50-point threshold in August for the first time this year, on the back of waning domestic demand and a gloomier view of current economic conditions in the country.
Author: Almanas Stanapedis, Economist