The Central Bank estimates that the country's growth could fluctuate between -1.5 and -2.5% in 2020. Last December, the estimate for GDP was between 0.5% and 1.5%. With regard to the main variables, the governing body forecasts a fall of 8.2% for investment and 1.9% for consumption. Thus, domestic demand will contract by 5.8%.
The Central Bank cut interest rates to 0.5%, its lowest level since June 2010. "The sharp change in the macroeconomic scenario caused by COVID-19, including the spread of the pandemic to Chile, leads us to estimate that the economy began a severe contraction in the second half of March that will extend into the second half of the year," said the Central Bank.
The IPSA, the index that groups the main 30 shares of the stock market, registered a monthly variation of -15.4% in March, while in the first quarter of 2020 the national stock market accumulated a drop of 25.3%. It is worth noting that between last October 18, when the social crisis began in Chile, and Tuesday 31 March, the national stock exchange has fallen 32.8% in value.
The Chamber of Deputies passed a bill to protect jobs which was promoted by the Government as part of an around $12 billion economic package announced to alleviate the consequences of the Covid-19 pandemic.
Industrial production in Chile grew by 5.6% in February compared to the same time last year, driven mainly by the mining and manufacturing sectors. The sector that most influenced the increase in February was the Mining Production Index (IPMin), which showed a 9.9% rise in 12 months due to metal mining, which grew by 8.4% in the extraction and processing of copper, of which Chile is the world's largest exporter.