Chile: Business confidence moderates amid weaker growth prospects
April 28, 2011
In the first quarter, the business confidence index (IEE, indice de Expectativas Empresariales) produced by the Camara de Comercio de Santiago (CCS) moderated to 73.4 points from 77.8 points in the previous quarter. The moderation from the elevated result recorded in the previous quarter reflected a more sober assessment of the economic outlook over the coming year, amid escalating commodity prices and higher interest rates. In fact, the share of respondents expecting the economic situation to improve next year fell from 72% in the final quarter to 61%, while the share of respondents expecting an unchanged outlook grew from 26% to 34%. In spite of the fall, the index sits well above the 67-point long-term average, suggesting confidence levels in the business sphere remain high. At the sector level, the weaker reading reflected notable deteriorations in the commerce and services sectors, while the industrial sector moderated at a slower pace. In addition, investment, sales and employment expectations deteriorated over the previous quarter.