Chilean economy shrinks 2.1% in first quarter of 2009

SANTIAGO.- According to information released today by the Central Bank, the Chilean economy reported a 2.1% contraction for the first quarter of this year.

The figure is far below that reported for the same period in 2008, when the GDP grew by 3%, as well as the total growth for the whole of 2008, which reached 3.2%.

Market forecasts had predicted a contraction of close to 2.4%.

According to the Central Bank, the sectors that experienced decline were Mining, Trade, Transportation, Construction and Industry – which reported the greatest drop.

Meanwhile, internal demand fell by 7.6% and total consumption dropped by 0.6%.

Furthermore, real national gross earnings slid 5.8%, following a 6.7% decrease in the previous quarter. The drop can be explained by lower exchange rates, partially compensated by lower payments made abroad.