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The Chilean economy grew at the strongest pace in three quarters during the April to June period, official data showed Wednesday. The growth also exceeded economists' forecasts.
Chile's gross domestic product, or GDP, grew 6.5% year-on-year in the second quarter, much faster than the 1.5% growth seen in the previous quarter, data from the Central Bank of Chile showed Wednesday. GDP increased for the third consecutive quarter.
Economists were looking for an increase of 6.2%. A year earlier, GDP had fallen 4.5%.
The central bank said real disposable gross national income increased 14.3% annually in the second quarter, faster than 10.2% growth seen in the previous quarter.
Similarly, domestic demand also climbed 19.4% compared to a 11.8% increase in the previous quarter. Gross fixed capital formation grew 28.6% after rising 8.1% in the first quarter.
At the same time, private consumption expenditure grew 10.7% in the second quarter compared to the 7.9% growth seen in the previous quarter. Government consumption expenditure rose only 2.7% compared to 0.5%. Exports of goods and services rose 0.2% in the second quarter, compared to a 5.6% drop in the previous quarter. At the same time, imports of goods and services increased 33.3% compared to a 19.7% increase in the previous quarter.
The central bank data also showed the current account surplus at US$46.8 million in the second quarter, down from a US$1.28 billion surplus in the previous quarter. Economists had expected the current account surplus to be at US$75 million.
While the capital account surplus fell to US$4 million in the second quarter from US$4.14 billion in the March quarter, the financial account deficit narrowed to US$109.4 million from US$5.54 billion.
Last week, the Central Bank of Chile raised its monetary policy interest rate by 50 basis points to 2% in light of the expected rise in demand and output.
Additionally, the bank pointed out that unemployment had also declined. According to the bank, the external scenario for the Chilean economy remained favorable.
Furthermore, another central bank report released earlier this month showed that the monthly index of economic activity or IMACEC increased 6.8% on an annual basis in June. Month-on-month, the economic activity index grew a seasonally adjusted 0.8%. IMACEC evaluates the development of net output of goods and services.
The trend cycle series recorded an annualized expansion of 5.6% in June, mainly influenced by improved activity in retail and wholesale trade as well as in transportation and utility sectors.
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