SANTIAGO – The Central Bank said on Tuesday that economists it polled have revised their 2019 economic growth forecasts for Chile downward by 0.30 percent to 2.9 percent
The economists also trimmed their 2020 and 2021 gross domestic product (GDP) forecasts by 0.10 percent to 3.3 percent, the Central Bank said, citing the Monthly Economic Expectations Survey for June.
The Central Bank survey includes 50 academics, consultants and bank economists.
The experts’ GDP growth forecast is within the range laid out by the Central Bank in its Monetary Policy Report (IPOM), which was released on Monday.
In the report, monetary policy makers cut their GDP forecast for this year to a range of 2.75 percent to 3.5 percent.
The Central Bank’s GDP number is lower than that projected by the government, which expects Chile’s economy to grow 3.5 percent this year.
Officials, however, acknowledged recently that hitting 3.5 percent will be difficult due to the slowdown in the global economy caused by the trade war between the United States and China.
Economists surveyed by the Central Bank, however, said the economy rebounded in May, with the Monthly Economic Activity Index (Imacec) rising 2.4 percent, up from the 2.1 percent increase registered in April.
The Imacec, which is prepared by the Central Bank, incorporates 91 percent of the goods and services included in the gross domestic product (GDP).
Economists are forecasting 2.5 percent GDP growth in the second quarter on a year-on-year basis, up from the 1.6 percent growth recorded in the first quarter.
On the inflation front, economists expect prices to rise 0.20 percent in June, well below the 0.60 percent increase registered in May, leaving the inflation rate at 1.5 percent since Jan. 1 and 2.3 percent on a year-on-year basis.
Economists expect the inflation rate to be 2.8 percent this year. Chile finished 2018 with an inflation rate of 2.6 percent and economists expect prices to rise 3 percent in 2020.
The economists polled for the Monthly Economic Expectations Survey expect the Central Bank to leave the benchmark rate at 2.5 percent.
Monetary policy makers surprised the markets last Friday by cutting the benchmark rate by 50 basis points.