global consumers of copper—Chile’s main mining export. Lastly, sentiment in the construction sector bounced back into pessimistic territory following the best result in several years in March. Consequently, three out of four sectors were in positive territory in April. Panelists surveyed for last month’s LatinFocus report expected fixed investment to expand 4.6% in 2018, down 0.2 percentage points from last month’s estimate, and 4.5% in 2019. Business Confidence Note: Business Confidence Index (IMCE, Indicador Mensual de Confianza Empresarial ). Values above 50 indicate optimistic perception, below 50 indicate negative perception. Source: Universidad Adolfo Ibañez / ICARE. 35 40 45 50 55 60 Apr-16 Oct-16 Apr-17 Oct-17 Apr-18 Consumer Confidence Note: Consumer confidence index (IPEC, Indice de percepcion de la economia ). Values above 50 indicate an optimistic assesment in consumer sentiment while values below 50 indicate a pessimistic assesment. Source: Adimark GfK. 30 40 50 60 Apr-16 Oct-16 Apr-17 Oct-17 Apr-18 EMISPDF in-isb_emis from 18.104.22.168 on 2018-06-07 19:51:22 BST. DownloadPDF. Downloaded by in-isb_emis from 22.214.171.124 at 2018-06-07 19:51:22 BST. EMIS. Unauthorized Distribution Prohibited.
FOCUS ECONOMICS Chile LatinFocus Consensus Forecast | 57 May 2018 MONETARY SECTOR | Inflation ticks up in April Consumer prices rose 0.3% in April compared to the prior month, up from March’s 0.2% increase and beating analysts’ expectations of a 0.2% rise. According to the National Statistical Institute (INE), the uptick was driven by higher prices for healthcare, and housing and basic services, which were partially offset by a decrease in clothing and footwear prices. Inflation edged up from 1.8% in March to 1.9% in April and now lies just below the lower bound of the Central Bank’s 2.0%–4.0% tolerance range. After removing volatile categories such as fruit, vegetables and fuel, core consumer prices rose 0.4% month-on-month in April, up from 0.3% in March and the strongest increase in six months. Meanwhile core inflation came in at 1.7%, matching March’s revised print (previously reported: 1.6%). The significant appreciation of the peso against the dollar since December last year is likely playing a key role in softer price pressures. The Central Bank predicts year-end inflation of 2.3% in 2018 and 3.0% in 2019. FocusEconomics Consensus Forecast panelists expect inflation to end 2018 at 2.6%, which was 0.1 percentage points from the previous month’s forecast. The panelists see inflation ending 2019 at 3.0%. MONETARY SECTOR | Central Bank leaves policy rate unchanged in May At its monetary policy meeting ending on 3 May, the board of the Central Bank of Chile (BCC) unanimously voted to hold the policy rate stable at 2.50% for the tenth consecutive meeting, in line with market expectations. In turn, the monetary policy environment in Chile remains among the most accommodative in Latin America.
- Summer '18
- Sagar Arora
- Inflation, LatinFocus Consensus Forecast