Chile’s economic activity recorded its first year-on-year drop since February 2021 as trade and manufacturing declined.
The Imacec index, a benchmark of gross domestic product, fell 0.4% in September from the same month last year, according to data released by the Central Bank on Wednesday. Analysts consulted by Bloomberg had expected a 1.1% year-on-year decline.
The seasonally adjusted series rose 0.2% compared to the previous month and fell 0.3% in twelve months.
The performance of services drove this growth, the Central Bank said.
This increase occurs even though the monetary authority will continue with a high reference interest rate to contain inflation that reached its highest level in 30 years.
A Bloomberg survey forecasted a 0.4% drop for the seasonally adjusted series.
The services sector grew by 2.9% in twelve months and by 0.4% monthly.
Meanwhile, commerce and manufacturing fell by 10.2% and 4.4%, respectively, in annual terms.
Andres Perez, the chief economist at Itaú, said that services continue to show resilience, although all sectors grew relative to August.
“The improved performance could lead to a correction in the economy’s growth this year, although challenging conditions remain for 2023. The coming months should already see more pronounced year-on-year contractions,” he added.
Last week, the International Monetary Fund (IMF) said that Chile will record a contraction of 1.3% next year, the only economy in Latin America and the Caribbean to decline by 2023.
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