Chilean government rules out an economic recession for 2023

The Chilean economy improved its forecasts for 2023, according to the Ministry of Finance

The Government of Chile, through the Ministry of Finance, improved its forecasts in relation to the growth of the country’s Gross Domestic Product (GDP) in 2023, which, according to its estimates, will expand by 0.3 % at the end of the year compared to the 0.7 % drop expected in the last Public Finance Report (IFP) for the fourth quarter of 2022.

Thus, the Government joins other institutions in the country, such as the Central Bank of Chile, which also indicated that the Chilean economy will grow more than initially expected. In the case of the central body, it is estimated that GDP could increase by up to 0.5 % and, in the worst-case scenario, only contract by 0.5 %.

On the contrary, different international organizations such as the World Bank or the Economic Commission for Latin America and the Caribbean (Cepal) recently stated that the Chilean economy will contract in 2023, with a decline in GDP of 0.7 % or 0, 3 %, according to both institutions.

For its part, inflation will maintain its downward trajectory during the year, assured by the monetary and fiscal contraction, the fall in the prices of raw materials at the global level, the appreciation of the peso and the adjustment of domestic demand. The Government report projects a Consumer Price Index (CPI) of 4.6 % in December, which for the year will average 7.9 %.

The good performance of economic activity in the first months of the year and a lower base of comparison have led to an upward revision of the estimates for GDP growth and domestic demand for 2023.

Source: dpa

(Reference image source: Unsplash)

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