Chile’s GDP Grew 0.2% in Second Quarter Amid Investment DeclinePhilip Sanders
Chile’s economic growth slowed in in the second quarter as a downturn in investment in the mining industry spread to consumer spending.
Gross domestic product rose 0.2 from the previous three months, when the economy expanded a revised 0.6 percent, the central bank said on its website today. The median forecast of nine economists surveyed by Bloomberg was for growth to stall in the second quarter. GDP expanded 1.9 percent from the year earlier, compared with analyst estimates of 1.8 percent.
The central bank cut its benchmark interest rate for the sixth time since October last week as the expansion in economic activity, measured by the Imacec index, missed analyst estimates in five of the first six months of the year. Manufacturing contracted in June for the eighth month out of the past 12, while retail sales rose at the second-slowest pace since 2009.
“The weak performance of sectors linked to internal demand continued to be the leading factor behind low economic growth,” the central bank’s research department said on Aug. 13. “In particular, manufacturing and commerce contracted in respect to last year.”
Chile posted a current account surplus of $28 million in the second quarter, compared with a deficit of $667 million in the previous three months and a shortfall of $1.7 billion the year earlier.
Economic growth has slowed from 4.1 percent last year and 5.4 percent in 2012 as an investment boom in the mining industry comes to an end. Investment slid 8 percent in the second quarter from the year earlier after dropping 5.5 percent in the previous three months and 12.3 percent in the four quarter.
Weak growth may continue after imports of capital goods, a measure of investment in the economy, slumped 36 percent in July from the year earlier, the biggest decline this year, the central bank said on Aug. 7.