UPDATE 2-Chile's economy posts weakest monthly growth in over four years

martes 5 de agosto de 2014 12:26 GYT
 

(Adds results of Reuters inflation poll, link to graphic)

By Anthony Esposito

SANTIAGO Aug 5 (Reuters) - Chile's economy grew at its slowest pace in more than four years in June, a below-forecast surprise that likely opens the door to more interest rate cuts.

Economic activity rose 0.8 percent in June from the same month a year ago, despite one extra working day, as manufacturing, wholesale, retail and car sales all fell, the central bank said on Tuesday.

It was the lowest reading since March 2010, when the South American country was dealing with the aftermath of a devastating earthquake and tsunami.

The anemic growth came despite forecasts for a 2.0 percent rise, according to a Reuters survey.

"Even with low expectations, June's Proxy GDP (IMACEC) managed to surprise on the downside ... Although inflation data may provide some hesitation if it comes well above expectations, we believe the data should seal a call for a rate cut to 3.5 percent next week," said Pedro Tuesta, an analyst at 4Cast.

The IMACEC economic activity index encompasses about 90 percent of the economy tallied in gross domestic product data.

In a bid to kick-start the economy, Chile's central bank has reduced the benchmark rate by 125 basis points to 3.75 percent since last October.   Continuación...