CHILE
Analysts
Robert Funk
Former President, Political Science Association
Igal Magendzo
Former Manager of Macro Analysis, Central Bank
Andrés Velasco
Former Finance MinisterDatabanks
Recent Country Insights
Change of mind
CHILE · Report · 13 Sep 2024
The significant expansion of the Monthly Index of Economic Activity (IMACEC) in July should be taken with a grain of salt. Recent data show increased volatility. These wide swings were primarily driven by successive one-off events. Everything points to a likely reversion in the IMACEC in coming m...
Reality check
CHILE · Report · 22 Jul 2024 · 1 response
The Central Bank's early-year optimism is losing steam. After progress in January and February, the next three consecutive IMACEC readings showed a negative trend. The overall negative effect of the IMACEC is particularly evident in the industrial sector. While the manufacturing sector declines, ...
Electricity tariff adjustments and CPI impact
CHILE · In Brief · 14 Jun 2024 · 1 response
After the social unrest at the end of 2019, electricity rates to households were frozen. This freeze has resulted in a shortfall for the electricity companies of approx. $6 billion. Since October 2019, the electricity CPI has only increased by 1.8%, contrasting with the 25.8% rise in the headline...
A deceptive first quarter
CHILE · Report · 30 May 2024
At first glance, Q1 activity data appears positive compared to the recent past. However, this improvement results from a smaller-than-usual drop in activity during the holiday months, rather than from an increase in GDP. A significant part is explained by household consumption. Upon closer inspec...
The CBCH is like a kingfisher in a speedboat
CHILE · Report · 23 Apr 2024
Two consecutive positive surprises in the IMACEC were swiftly followed by an upward revision of the Central Bank’s 2024 GDP growth forecast. Still, the positive result was largely attributable to a milder-than-usual seasonal decline in economic activity, rather than to genuine growth. While macro...
Chile: Progressive policy creep
CHILE · In Brief · 18 Mar 2024
It seems that Boric has stopped trying to appeal to the center. His popularity—forever stuck in the 25-30% range—is unlikely to rise, or fall. Looking ahead, Boric told his cabinet, “In the remaining two years of government, (we need) not to make promises, (but) to fulfill them.” Boric, like most...
February CPI and monetary policy implications
CHILE · In Brief · 14 Mar 2024
The second CPI under the newly-designed basket surprised on the upside again, confirming that the new basket inherited the old basket’s volatility. Some of the problem might be attributed to the volatility of the exchange rate and international prices, but this would only affect a limited part of...
When the music's over
CHILE · Report · 04 Mar 2024 · 1 response
The Central Bank took a significant step in January, by reducing the Monetary Policy Rate (TPM) by 100bp and adjusting its baseline scenario to a more accelerated convergence towards the neutral level. The new timeline for the TPM's convergence to its neutral level is set for the second half of 2...
Fires and pensions: When it doesn’t rain it pours
CHILE · In Brief · 05 Feb 2024 · 1 response
It is not uncommon for the Chilean summer to be fairly dry. The country’s central valley barely sees a drop of rain between the months of November and March. As the winters have got drier as well, summer wildfires have become more common. In recent days, several fires have appeared around the cou...