Chile faces a tangible risk of slipping into a technical recession, according to Vittorio Corbo, the former president of the Central Bank of Chile.
Corbo estimates the probability of a contraction at approximately 30%, citing a stalled growth engine that has failed to gain momentum in recent quarters.
5%. The board recently reached a unified stance on the current economic outlook, signaling a pause in both tightening and easing measures.
The assessment aligns with shifting market sentiment, where investors are increasingly pricing in a monetary policy easing from the central bank.
Financial markets have responded to the sharp decline in economic activity and cooling inflation expectations by adjusting their outlook on the country's policy trajectory.
This warning comes as the Central Bank of Chile maintains its target policy rate at 4.5%.
The board recently reached a unified stance on the current economic outlook, signaling a pause in both tightening and easing measures.