Chile: Projections for economic growth in February reach up to 4%.

During the same period in 2023, it expanded by 0.6% against a high comparison base. The Central Bank will report the official figure on Monday.

The growth in industrial production and new positive figures in trade reported on Thursday by the National Statistics Institute (INE) translated into enthusiastic estimates for the Monthly Economic Activity Index (Imacec) of the period, which harkened back to results observed in 2022.

Scotiabank’s chief economist, Jorge Selaive, wrote on his X account that the “sectoral figures for February reaffirm positive momentum in activity. Imacec in February between 4% and 5% year-on-year (with positive seasonally adjusted data) will be a surprise to the consensus (1.5%) with annualized seasonally adjusted growth in March between 7% and 9% (3 times the expected for the US).”

This view coincides with the approximations made by the Chilean Ministry of Finance, which also expects significant results for the second month of the year, to be reported by the Central Bank on Monday.

On average, its effect is about one percentage point of higher activity in February. The greatest impact is seen in mining.

A 4% increase in Imacec is anticipated due to better-than-expected retail sales, industrial and manufacturing production, in line with preliminary figures for energy, confidence, and consumer credit flows.

“This allows the Central Bank to slow down interest rate cuts since the economy is strong. In turn, this would prevent the rate differential from falling too quickly and, therefore, the exchange rate from appreciating,” the analyst noted.

An expansion of activity by 4%, consistent with a 2% advance in seasonally adjusted monthly level.

“In conclusion, economic activity started the year with a very good performance, better than expected. The fact that it is a leap year exacerbates the February figures, in line with recent comments by the Central Bank,” added in a report.

Discounting seasonal factors and calendar effects, there is maintained good dynamism, particularly in sectors linked to the production of goods.

Solid sectoral data reaffirm that the worst is behind us and that the economy maintains a strong recovery.