Expert: August Imacec likely to remain negative as mining declines

Chile’s economic activity likely remained negative in August, with another decline in mining expected to weigh on the Imacec indicator, according to Gabriel Valenzuela of the Adolfo Ibáñez University business school.

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The minus 1.5% we had in July is explained mainly by the mining sector, which fell 9.3%.

Speaking to Cooperativa, Valenzuela said August’s result would probably resemble July’s contraction. He pointed to storms in northern Chile as another source of downward pressure, alongside the mining sector’s performance.

“The minus 1.5% we had in July is explained mainly by the mining sector, which fell 9.3%,” Valenzuela said. He added that flooding, suspended operations and lower production projections at mining companies could produce a similar result in August.

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In August we also had storms in the north, and that will also put downward pressure on the Imacec.

Valenzuela said the storms were the main explanation cited by the Central Bank, together with the Copper Law, for July’s negative Imacec. In his view, those factors worked against the government’s high expectations for economic growth.

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I think the fact that we had the storms, which was the main explanation given by the Central Bank together with the Copper Law for the negative Imacec, worked against the government’s very high expectations for economic growth.