Chile growth drivers fading away

Chile real GDP in q/q terms was flat in Q2 15, from a strong 1.1% growth in Q1. All the components of domestic demand contracted, with a marked reduction of 2.1% q/q sa in investment. On the other hand, exports and imports were both reduced by 4.1% q/q sa. 

On the supply side, all sectors related to mining complex suffered a reduction in GDP; meanwhile, services, including utilities, construction and communications, were a positive highlight. Overall, negative news for activity in Chile should prevail in H2 as copper prices fail to recover, China continues to decelerate and the labor market weakens, says Barclays in a research note.