MercoPress. South Atlantic News Agency

Latest data show Chilean economy rebounding from recession

Chile is the world’s top copper producer

Chile’s economic activity index, the IMACEC, rose a bigger-than-expected 3.1% in November from a year earlier, the central bank announced this week, the first monthly increase in a year. The market expected the economy of the world's top copper producer to expand by 2.5%, according to a median forecast from a Reuters’ survey.

The index fell 0.9% in October and 1.1% in November 2008. The most recent IMACEC reading rose a seasonally adjusted 1.2% from October.

“The November IMACEC reading is very good, well above expectations, and this is because industrial output also surprised with a rise” said Tomas Flores, an economist at the Instituto Libertad y Desarrollo think-tank.

”With the (November) IMACEC, the recession, in terms of successive falls in production activity, is over. We should see only positive numbers going forward,” he added.

The jump in the IMACEC came after Chile's industrial output rose unexpectedly in November for the first increase in 14 months and as copper output surged. Industrial output rose by 1% driven by external demand, the National Statistics Institute (INE) reported last week.

Chile's GDP fell by 1.6% in the third quarter from the same period in 2008, but grew a seasonally adjusted 1.1%t compared with the second quarter.

The economy is on course to formally exit recession in the fourth quarter, though the central bank has warned that Chile's recovery from an economic slump will be more gradual than originally expected.

Chile's central bank last month maintained its outlook for 2010 economic growth of between 4.5% and 5.5% but cut its inflation outlook for next year to 2.5%. The bank forecast an economic contraction of 1.9% in 2009.