Chilean mining production plunges in January
Chilean factory output dropped sharply in January as mining output plunged, although retail sales in the Andean country held up.
Manufacturing production fell at a 4.6% year-on-year clip, far more than the 3.3% decline which economists had penciled in.
Nine out of thirteen manufacturing subsectors registered a drop, as total production fell by the most since since the start of 2010.
Mining output was 12.6% lower in comparison with a year ago.
Production of metals saw the steepest decrease, followed by food.
Retail sales on the other hand grew by 3.4% year-on-year, edging past a consensus forecast for an increase of 3.3%.
Nonetheless, Andres Abadia, senior international economist at Pantheon Macroeconomics, told clients that: "On the consumer spending front, retail sales have been very volatile in recent months, and the underlying trend remains relatively soft.
"The acceleration in January partly reflects a rebound from a very weak reading in December, which has been revised marginally lower to 1.8% y/y, and a favourable base effect."
A sharp and unsustainable 12.2% year-on-year jump in automobile sales boosted those for durable goods, Abadia said.
"Looking ahead, we continue to expect the recovery in consumer spending to remain very modest", he added.
"The CLP's depreciation, coupled with slowing real wages and stubbornly high inflation, have constrained spending in recent quarters."