Fynsa
The Chilean economy started 2026 with a 0.5% contraction, worse than expected. Sectors such as mining, agriculture, and fishing account for much of this decline, but underlying indicators point to a more challenging year than projected.
The June CPI showed a monthly decline of 0.4%, well below our and the market's estimates. Although the aggregate result seems significant, the underlying indicators soften the analysis somewhat.
After months of weak numbers, some recent data point to an improvement in activity. But before celebrating, it is worth taking a cautious look at what lies behind the apparent upturn.
This scenario raises concerns about long-term fiscal sustainability, with a direct impact on political decisions and the financing of public services.
The fact that the risks have not materialized does not mean that they may not do so, but at a later date. External pressures and the weakness of the peso could reactivate inflation in 2025.
Will we continue to see a falling exchange rate on the back of the copper rally?
Nathan Pincheira and Humberto Mora of Fynsa share their outlook on the economy and investments for the first half of 2023 and the coming months.
Without promoting policies that encourage investment, allowing for sustainable economic growth going forward, we are unlikely to see a change in the employment slowdown.
We see it as quite likely that we will never again have the same number of people working as we had prior to the social explosion/pandemic.
While the Central Bank is doing everything possible to lower inflation, the work of the public and private sectors must focus on productivity, the only way to generate wealth without boycotting the work of monetary policy.
