MercoPress. South Atlantic News Agency

Chile's trade balance on the rise

Chile's domestic economy is contracting at a slower pace than expected, thanks to consumption remaining at high levels, the Central Bank explained

Chile's foreign trade reached US$ 86.149 billion between January and May of 2022, according to data from the Undersecretariat of International Economic Relations, which showed a 20% interannual increase, it was reported Tuesday.

Chilean exports rose to US$ 42.94 billion, a 12% growth from the same period of 2021, while imports amounted to US$ 43.21 billion, a 30 percent yoy increase.

International Economic Relations Undersecretary José Miguel Ahumada said in a statement that these figures are “good news, as there is a recovery in the growth of exports with respect to the previous period.”

Ahumada also called for efforts to be made to export products with higher added value, which tend to have less volatility in demand and prices than less processed products.

Topping Chilean exports were lithium carbonate, salmon, fresh cherries, fertilizers, fresh grapes, molybdenum oxide, sawn wood, poultry meat, avocados, potassium nitrates, and wood boards.

Imports consisted mainly of diesel, chemical products, clothing, metal products, gasoline, mineral coal, automobiles, cardboard and paper, petroleum, and fertilizers.

Meanwhile, Chilean salaries have fallen 2.3% in the last 12 months, accumulating a negative variation of 1.3 percent so far this year, according to a National Statistics Institute (INE) report issued Tuesday.

The Nominal Index of Remunerations (IR) measures the evolution of remunerations adjusted by the monthly variation of the Consumer Price Index. This index measures the purchasing power of salaries, which is essential in an inflation-riddled scenario.

In yet another news affecting Chile's economy and which was also announced Tuesday, the Central Bank has raised the monetary policy interest rate (TPM) by 75 basis points to 9% in response to an inflationary context.

The Central Bank explained in a statement that global inflation continued to rise, showing more generalized and persistent price increases and that central banks worldwide have continued to rise their reference rates, while world growth expectations have deteriorated in the face of worse global financial conditions.

However, the monetary entity highlighted that the local economy was contracting at a slower pace than expected, thanks to consumption remaining at high levels.

(Source: Xinhua)