WRAPUP 2-Chile slowdown deepens as output crashes, joblessness rises
(Adds growth forecast, analyst's comments, minutes, background)
By Anthony Esposito
SANTIAGO, Sept 30 (Reuters) - An economic slowdown continues to grip Chile, government data showed on Tuesday, when the world's top copper producer posted its biggest monthly drop in manufacturing production in two years and higher jobless figures.
The jobless rate for the June-through-August period rose to 6.7 percent, while factory output fell 4.9 percent in August from a year earlier, well below market forecasts.
Production fell across the board, with declines in the important metals, agricultural chemicals, wood pulp and food industries, according to government statistics agency INE.
A slowdown in mining investment in Chile has spread to domestic demand, hurting sentiment and complicating President Michelle Bachelet's ambitious reform program.
To counteract the slowing economy, Bachelet's government plans later on Tuesday to send Congress its 2015 budget, which would provide the biggest boost in spending in seven years.
The IMACEC activity index, which measures Chile's economy, is likely to have grown 0.5 percent in August from a year earlier, according to 14 analysts and economists polled by Reuters on Tuesday. That would be its slowest pace since March 2010, when the country was dealing with the aftermath of a devastating earthquake and tsunami.
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