UPDATE 2-Chile data points to Sept economic rebound but slowdown not over

miércoles 29 de octubre de 2014 16:23 GYT
 

(Recasts; adds comments, forecast for economic activity)

By Anthony Esposito

SANTIAGO Oct 29 (Reuters) - Chile's sluggish economy likely rebounded in September after official data showed a surprise jump in factory output, but analysts and the government urged taking Wednesday's figures with a grain of salt before declaring victory over the slowdown.

Manufacturing production rose 5 percent from a year earlier, the biggest increase in nearly two years. But retail sales contracted for the first time since the mid-2009 recession, and copper production also fell 5 percent from September 2013.

Manufacturing growth easily beat forecasts for a 0.8 percent rise and was a pleasant surprise for President Michelle Bachelet's government, which has had a hard time defending structural reforms to taxes and education during the economic slowdown in Chile, the world's top copper producer.

"This result is due mainly to an increase in activity in the food and beverages division, in particular strong dynamism in the production of carbonated drinks and the salmon industry" and to a lesser degree due to greater production of medicines, the government INE statistics agency said.

The economy likely posted its largest monthly growth since May, according to the median estimate of 14 analysts and economists polled by Reuters after the data was released,

They estimated a 2.0 percent September increase in the IMACEC economic activity index, a proxy for gross domestic product. That would be a sharp jump from the 0.3 percent growth registered in August.

But the September data was distorted as two extra working days boosted manufacturing output, while two fewer holidays hurt retail sales, said Goldman Sachs economist Tiago Severo.   Continuación...