Chile: Economic activity soars in March, reflecting last year?s earthquake
May 5, 2011
In March, economic activity surged 15.2% over the same month last year, the fastest pace in almost two decades, according to the monthly indicator for economic activity (IMACEC, Indicador Mensual de Actividad Economica). The reading came in above the 7.2% expansion registered in February but broadly matched market expectations of economic activity growing 15.0%. The March increase was mainly due to a low base of comparison, as activity had dropped 2.0% in March 2010, following the 27 February 2010 earthquake. However, a month-on-month comparison does not corroborate the acceleration suggested by the annual figures, as economic activity rose just 0.3% over the previous month in seasonally adjusted terms, following a similar 0.4% increase in February. That said, the trend continues to point upwards, with annual average growth jumping from 5.6% in February to 7.1%, which marks the fastest pace since May 1998. Based on the monthly data, economic activity expanded 9.8% in the first quarter, which came in well above the 5.8% expansion observed in the final quarter of 2010. On 5 May, Finance Minister Felipe Larrain stated that the country is on ?a robust growth trend?, with GDP likely to expand more than 6% this year. The Central Bank expects economic growth to range between 5.5% and 6.5% this year.