The Chilean economy fell 1% year-on-year in December: it is the fourth consecutive collapse
The data, although negative, is better than expected
A woman sells lemons in a market in Santiago (REUTERS/Sofia Yanjari/File)
Chile's Monthly Economic Activity Index (Imacec), which is considered an advance estimate of GDP, fell 1% last December compared to the same year before, representing fourth consecutive decline, the Central Bank reported on Wednesday.
The Imacec data, which represents close to 90% of the South American country's Gross Domestic Product (GDP), is better than expected given that December growth estimates pointed to a year-on-year drop of up to 2.8 percent.
“The fall in the Imacec was explained by commerce and the manufacturing industry, a result that was partly offset by the growth in services,” the issuer explained.
< p class="paragraph">The seasonally adjusted series increased 0.4% compared to the previous month, driven by the performance of services, and fell 1% in 12 months, added bank.
Containers in the port of San Antonio, Chile (REUTERS/Rodrigo Garrido/Archivo)< p class="paragraph">The non-mining Imacec, which excludes Chile's main economic activity, “presented a decrease of 1.1% in 12 months, while in seasonally adjusted terms, it grew 0.5% compared to the previous month,” the institution stated.
The Chilean economy recovered faster than expected after the pandemic and grew a record 11.7% in 2021, but inflation skyrocketed 7.2%, the highest in 14 years.
The financial aid provided by the Chilean government to alleviate the impact of the pandemic, as well as the early withdrawals of pension funds, considerably boosted consumption to which are added the effects of the war in Ukraine, according to experts.
The economy began to slow down in 2022 and, pending from the official consolidated data, year-on-year growth is expected between 2% and 2.4 percent.
By 2023, the issuer projects a contraction of ent re -1.75% and -0.75% and estimates that inflation will converge to the 3% target in the second half of 2024.
(With information from EFE)