The Chilean government has lowered its economic growth forecast for 2026 while projecting a rebound to 3.7% in 2027, according to the latest Public Finance Report (IFP) released by the Ministry of Finance.
José Pablo Gómez, director of the Budget Directorate (Dipres), presented the updated figures, which reflect a more cautious outlook for the current year.
The report anticipates a narrower fiscal deficit, driven by higher copper revenues and additional spending cuts.
The downgrade aligns with broader market sentiment that has increasingly priced in monetary policy easing from the Central Bank of Chile.
Investors have reacted to a sharp decline in domestic economic activity and cooling inflation expectations by betting on rate cuts to support the economy.
The revised growth trajectory highlights the challenges facing Latin America’s second-largest economy as it navigates a period of subdued demand.