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Chile Economic Activity May 2022

Chile: Economic activity slows in May but beats expectations

Economic activity grew 6.4% year on year in May (April: +6.9% yoy). May’s result marked the worst reading since February 2021, but still comfortably beat market expectations. Looking at the details of the release, the mining sector fell at a softer pace in May, while the non-mining sector increased at a weaker pace.

On a seasonally-adjusted monthly basis, economic activity fell at a more moderate rate of 0.1% in May (April: -0.3% mom), also beating market expectations. Meanwhile, the trend pointed down, with the annual average growth of economic activity coming in at 11.7%, down from April’s 12.8% reading.

On the latest reading and the outlook, Goldman Sachs’ Alberto Ramos said:

“We highlight a slowdown in non-mining sectors in May after the March-April prints had shown a pickup in activity. Except for other goods production, the sequential contraction in May was driven by weak activity in all other non-mining sectors. Going forward, we anticipate that very high inflation, rising interest rates, tighter financial conditions, and fiscal policy drag will continue to generate headwinds to economic activity.”

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