Chile GDP Q4 2015


Chile: GDP grows at slower pace in Q4; but ticks up in full year 2015

March 18, 2016

Chile’s economic growth decelerated notably in Q4 2015 as shrinking fixed investment and weaker consumption more than offset a mild recovery in the external sector. GDP slowed from Q3’s 2.2% year-on-year expansion to 1.3% growth in Q4. The result undershot market expectations of a 1.6% expansion. In the full year 2015, GDP grew 2.1%, which marked an uptick compared to 2014’s five-year-low 1.9% expansion.

In Q4, fixed investment contracted 1.3% year-on-year, contrasting Q3’s 4.3% rise. Public spending slowed from a 7.8% increase in Q3 to 4.9% growth in Q4. On top of this, private consumption growth decelerated from 1.3% in Q3 to 1.1% in Q4, marking the smallest expansion in over six years.

On the external side of the economy, the contraction in exports of goods and services softened from a 1.4% drop in Q3 to a 0.9% fall in Q4. At the same time, imports deteriorated, swinging from Q3’s 1.7% expansion to a 1.9% contraction in Q4. As imports recorded a steeper drop than exports, the external sector’s net contribution to overall economic growth improved from minus 1.2 points in Q3 to minus 0.4 percentage points in Q4.

On a quarter-on-quarter basis, growth decelerated from 0.3% in Q3 to 0.1% in Q4.

The Central Bank expects GDP to grow between 2.0% and 3.0% this year. Panelists participating in the LatinFocus Consensus Forecast see the economy growing 2.0% in 2016, which is unchanged from last month’s forecast. For 2017, the panel expects the economy to pick up the pace and expand 2.8%.

Author: Teresa Kersting, Economist

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Chile GDP Chart

Chile GDP Q4 2015

Note: Year-on-year changes of GDP in %.
Source: Chile Central Bank (BCC) and LatinFocus Consensus Forecast.

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