Chile cuts back growth forecast for 2021
SANTIAGO, Oct 1 (Reuters) - The Chilean economy is expected to fare better than initially expected in 2020, but will not recover as quickly as anticipated from the impacts of the coronavirus pandemic in 2021, Finance Minister Ignacio Briones said on Thursday.
Briones said he expects gross domestic product to contract by 5.5% in 2020, down from a 6.5% contraction forecast in June. In 2021, however, he said a previous forecast of 5.5% growth was cut back to 5% as the impacts of the pandemic are expected to linger.
Chile's economy has been hard hit by the health crisis. But the world's top copper producer´s mining industry proved resilient and has left the country in better shape than some of its neighbors in South America.
Briones, who presented part of the government's Public Finance Report to Congress on Thursday, said domestic demand will grow 6.5% next year, down from a previous estimate of 7.3%. Inflation is expected at 2.3%, near the bottom of the Central Bank's range.
Briones said 2020 inflation is forecast to be 2.8%.
The Chilean government is budgeting for an average copper price in 2021 of $2.88 per pound, versus a previous estimate of $2.60.
(Reporting by Natalia Ramos; Writing by Dave Sherwood; Editing by Bill Berkrot)
