|
Economic
growth in second quarter slightly better than expected
In the second
quarter, gross domestic product (GDP) expanded by 5.1% over the same
quarter last year. The final data came in slightly ahead of the 4.9%
growth based on the preliminary monthly data published last month.
The difference is mainly due to an upward revision of growth data for
April from 5.0% reported earlier to 5.3%. The second quarter growth
was slightly ahead of the 4.8% annual growth registered in the first
quarter and thus confirmed the anticipated quickening trend for this year
reflected in the LatinFocus Consensus Forecast. Moreover, seasonally
adjusted data corroborate the resilience of the Chilean economy, as the
activity advanced 1.3% over the previous quarter.
Buoyant
domestic demand accounts for acceleration of economic growth, as
contribution from external sector remains stable at high level
In the second quarter, the economy developed broadly along the lines
observed in the first quarter this year. Domestic demand accelerated
somewhat compared to the first quarter, whereas the already strong net
contribution from the external sector remained virtually unchanged.
Growth in domestic demand accelerated from a 5.3% pace in the first
quarter to 5.7% in the second. The acceleration was entirely due to
increased investment activity, whereas consumption and inventories – the
Central Bank only publishes joint data for the quarter – slowed from
5.1% annual growth to 4.9%. Gross fixed investment, on the other
hand, expanded 8.0%, which represented a notable improvement compared to
the 5.7% growth observed in the first quarter. The improvement was
due to a further pickup in investment in machinery and equipment, which
continued the accelerating trend observed since the third quarter last
year, when activity had declined. Investment in construction and
other works, on the other hand, continued to grow at the same 3.5% rate
observed in the first quarter. Finally, the net contribution from
the external sector remained virtually unchanged, as growth in exports
slowed from 9.9% in the first quarter to 9.0% in the second quarter and
growth in imports, which are a subtraction in the calculation of GDP,
receded from 12.0% to 11.0%.
Mining
accelerates amid a surge in private sector copper mining
Fishing was the fastest growing sector in the second quarter with a 24.8%
expansion. However, despite the impressive growth rate, the reading
actually represents a slowdown compared to the 32.1% growth registered in
the first quarter. In fact, the acceleration in economic growth in
the second quarter was mainly the result of faster growth in mining and,
to a lesser extent, commerce, restaurants and hotels. Mining added
6.4% over the second quarter last year, following on a 0.2% contraction in
the first quarter. The sector profited from ramping up of production
in private sector copper mines, whereas public sector copper mines
increased output at a more moderate pace. Industrial manufacturing,
the most important sector of the economy, slowed from the resilient 6.8%
observed in the first quarter but continued to grow at a robust 5.0% rate,
amid solid external demand. Activities related to the fishing and
paper industries were particularly strong, but were contrasted by
weakening transport equipment, refinery and textiles output. The
electricity, gas and water sector almost doubled the first quarter growth
rate of 1.2% but remained contained at a 2.3% expansion, as the sector was
severely hampered by shortages of natural gas shipments from Argentina in
spite of an improved supply situation in the second quarter.
Construction added 3.6% over the same quarter last year, virtually
unchanged compared to the first quarter growth reading, as major dynamism
in housing and commercial building was offset by lower industrial building
activities. In total, industrial activity advanced 4.8% in the
second quarter, following on 4.0% annual growth in the first.
Services
grow at quicker pace owing to strong sales activities
Services also experienced a notable pickup in the second quarter, as
growth accelerated from 3.9% in the first quarter to 4.4% growth in the
second. Faster growth in the commerce, restaurants and hotel sector
represented the key driver behind the acceleration of services.
According to the Central Bank, all subsectors performed well, with
particular strong activities in wholesale and retail sales. Growth
in transport and communications remained almost unchanged over the first
quarter at 3.9%, as below-average growth in telecommunications compensated
for strong transport activities related to the export boom.
Financial services added 4.7% over the same quarter last year, following
on 4.4% growth in the first quarter.
Economy
continues to grow at robust pace in July
In July, the Chilean economy continued to grow at the strong pace observed
in the second quarter and the outlook for the second half of the year
remains robust. The economy expanded 4.5% in July compared to the
same month last year, according to the monthly indicator for economic
activity (IMACEC, Indicador Mensual de Actividad Económica). The
result was slightly above the Consensus Forecast, which had anticipated
the economy to grow by 4.3%. A month-on-month comparison suggests an
even stronger economy than implied by the annual figure. According
to seasonally adjusted data, the economy added 1.45% over the preceding
month, following on a 0.45% monthly contraction in June. As a result,
the annual average growth rate inched upwards another notch from 4.1% in
June to 4.2% in July, the fifth consecutive increase that confirms the
consolidation of the higher growth trend observed in the past months.
|
Economic Forecasts
from Top Financial Institutions. Order
here!