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Mercados

UPDATE 1-Chile economy grows 1.1% in December, beating expectations amid protests

(Updates with mining activity index, additional context)

SANTIAGO, Feb 3 (Reuters) - Chile’s economic activity rose 1.1% in December from the same month a year ago, the central bank said on Monday, buoyed by a resilient mining sector and beating expectations after months of protests rocked the world’s top copper producer.

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

Mining activity jumped 3.7% in December, bolstered by largely steady copper production and an increase in output of battery metal lithium carbonate.

Total accumulated growth for 2019, however, landed at just 1.2%, measured in IMACEC terms, well below initial expectations, as the all-important mining industry sputtered early in the year, and riots in October and November caused short-term contractions.

Early indicators have nonetheless shown Chile’s economy to be surprisingly resilient following the most violent protests since the country’s return to democracy in 1990.

Mining and manufacturing activity, key economic drivers, have both proven stronger than anticipated. Unemployment is increasing in Chile, but not as dramatically as predicted.

For weeks in late 2019, protesters burned buildings, looted grocery stores and destroyed public infrastructure in Santiago and throughout the country. The violence saw the military take to the streets for the first time since the rule of strongman Augusto Pinochet. At least 30 people have died.

The unrest prompted the central bank in December to slash its 2020 growth forecast to a range of 0.5% to 1.5% from 2.75% to 3.75%.

Protests have subsided recently on announcements of a referendum vote on a new constitution in April and major social and economic reforms, though violence flared up again last week.

Polls show many Chileans worry of a tumultuous month of protests in March, when many residents of Santiago, a city of 6 million people, return to work and school following February holidays. (Reporting by Dave Sherwood; Editing by Alex Richardson)

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