It's no secret that I'm a die-hard fan of the Universidad de Chile. And as such, I’ve experienced both the sweet and bittersweet it can be to identify so strongly with a team, especially in a week like this one, when the 191st edition of the superclásico is being played. Not since May 2013—thanks to a goal by Charles Aránguiz in stoppage time—have we defeated our archrival, and, worse still, we haven’t done so at their stadium since 2001. It’s as if, regardless of the level of soccer the club displays, this fateful day always comes when we come crashing back down to earth, stop getting our hopes up that “this time it’s really going to happen,” and return to this reality that has lasted far too long.

I think this grounding wire illustrates very well what happened after the Central Bank published the January Imacec, which rose 9.0% compared to the same period last year. A change that, at any other time, would have been cause for celebration but which, this time around, has become a cause for concern. Regardless of whether the figure fell short of market expectations—which is somewhat subjective—it highlighted other signs of a slowdown that could be accelerating faster than expected. 

First of all, statistically speaking, it wasn’t unreasonable to expect a double-digit change, due to factors such as the level of the index, the basis of comparison, etc. This did not happen because, on a seasonally adjusted basis, the series fell 1.0% compared to the previous month, the largest decline since March of last year. “That wasn’t so long ago,” you might say, but let’s not forget that this result came after the the reinstatement of all mobility restriction measures across much of the country—something that hasn’t happened this time around. In fact, I haven’t been able to find any external factors that could explain this decline, which leaves us with only reasons directly linked to the economic cycle. 

Second,, when we break down the figure, we find that the sector that slowed the most was Retail, even though it continues to show significant year-over-year changes . Moreover, the pace of growth at a faster pace than in previous months. In contrast, Services was the only sector that continued to grow marginally, although it was also one of the last to join the recovery cycle of last year. Therefore, as we had anticipated, the absence of additional liquidity and fiscal transfers to households in 2022 is likely to have an impact sooner rather than later, although we will have to wait for more data before we can conclude this with greater certainty. 

Finally, the geopolitical events we are witnessing today will surely have an impact in the coming months, which will compound the domestic economic slowdown that has already begun. This confirms our expectation of growth below 2.0% for this year, which is below most estimates. After a buoyant 2021, the reality check of 2022 will bring us back to the reality of the country we’re building and show us that all bills, ultimately, must be paid. Although, just like in soccer, we think this time will be different.

Nathan Pincheira 

Chief Economist at Fynsa