Chile: Economic activity rises in annual and monthly terms in July
Economic activity expanded 4.2% year on year in July (June: +0.2% yoy). A pick-up from June was always likely, as economic activity in June was weighed on by temporary factors such as the early winter vacation, the reduced number of working days relative to June 2023, and the suspension of classes in certain regions as a result of heavy rainfall. However, the print marked the best reading since February and was well above market expectations.
Looking at the details of the release, mining sector growth softened in July, though this was more than offset by rebounds in services and manufacturing activity.
On a seasonally adjusted monthly basis, economic activity rose at a faster rate of 1.0% in July (June: +0.4% mom), the best result since January.
On the outlook, Itaú Unibanco analysts said:
“Indicators signal that the activity improvement ahead should be contained. […] We have a 2.5% GDP growth call for the year. While the anticipated activity rebound in July surpassed expectations, activity levels remain below that of February, reinforcing the loss of overall momentum since the start of the year.”
Goldman Sachs’ Sergio Armella said:
“Overall, while real GDP was better than expected in July, particularly for non-mining activity, we expect a weaker performance in August. Adverse weather caused several blackouts in the month in addition to the closure of schools which, as the July IMACEC print showed, has a significant impact on activity, services in particular.”