Category: Macroeconomy/Finance

Information regarding Chile’s finance sector and the country’s macroeconomy.

Chile’s economy falls by 15.3%

Chile’s economic activity fell by 15.3% in May from the same month in 2019, according to the Central Bank, hitting yet another historic low as measures to contain the spread of the coronavirus left many out of work and businesses shuttered. The bank’s IMACEC economic activity index encompasses about 90% of the economy tallied in gross domestic product figures.

Market predicts a further decline for June Imacec

With the Imacec in May dropping by 15.3%, the market predicts what the June Imacec could be. According to Banco Santander, the June Imacec should have fallen less intensely than in the previous months, but the annual variation would be a little lower than in May, around -16%. Meanwhile, Mauricio Carrasco from Econsult, projects a further deterioration in activity in June, with a decrease between 15-20%.

Manucturing drops by 13.3%, Copper rises by 0.6% and Mining increases by 2.1%

The Manufacturing Production Index decreased by 13.3% in May, hit by a decline in food processing, according to the National Statistics Institute (INE). The INE also reported that copper production in Chile rose by a weak 0.6% year-on-year to 495,604 tons in May, with resource extraction up 3.4% to May. Furthermore, the INE also said that the Mining Production Index showed an increase of 2.1% over the same month last year.

Unemployment in Chile increases to 11.2%

Unemployment in Chile rose to 11.2% in May and remained at its highest level in a decade especially in key sectors such as trade, accommodation and food services, according to the National Statistics Institute (INE). The record for May is 4 percentage points higher than in the same period of the previous year and 2.2 points more than in April.

Treasury introduces changes to Fogape regulations

The Official Gazette published a series of modifications made by the Ministry of Finance to the regulations of the Guarantee Fund for Small Business Owners (Fogape), with the aim of improving the delivery of credits in the midst of COVID-19. The main changes introduced are the reduction of the deductible and the extension of guarantees for small businesses.

Copper prices rise as COVID-19 threatens Chilean supply

Copper prices rose on Monday, trading close to a five-month high, due to disruptions in the supply of the metal in Chile solid demand in China and reduced inventories of the input. Three-month copper on the London Metal Exchange (LME) gained 0.2% at $5,969.50 a tonne, close to $6,006. The metal, used in the energy and construction industries, has soared 35% from its March floors, recovering almost all of the ground lost during the early stages of COVID-19.

Internet banking operations rise by 55% while ATM withdrawals fall by 54%

According to a report by the Association of Banks and Financial Institutions (ABIF), the number of clients connecting to online banking sites or apps reached more than 11 million in March, while the number of visits totaled 277 million sessions in the same month. Regarding the number of transactions carried out, the report indicates that, as of May, 55% of sales by credit card are associated with operations carried out over the internet; while ATM withdrawals decreased 54%, after less than 18 million were finalized last month.