UPDATE 2-Chile March economic activity growth slowest in 20 months
* Fall in industry, fewer working days weigh on indicator * Mining, retail sectors expand * Chile central bank expected to hold rates at 5 pct this year SANTIAGO, May 6 (Reuters) - Chile's economic activity growth in March was the slowest since July 2011, as expansions in the mining and retail sectors were partly offset by declining industrial activity and two fewer working days, the central bank said on Monday. The IMACEC economic activity index grew 3.1 percent versus a year earlier, coming in below forecasts for a 4.3 percent expansion. During the first quarter, economic activity grew 4.4 percent compared with the same period a year ago. In seasonally adjusted terms, March posted no variation versus February. An extended port strike also hit March's growth, Finance Minister Felipe Larrain said later on Monday, adding the stoppage would weigh on April's data too. Firm domestic demand, a tight labor market and solid levels of investment have so far helped the world No.1 copper producer avoid a sharp slowdown on the back of global economic woes. But analysts warn Chile's open, export-dependent economy is vulnerable to global economic turbulence. "Domestic activity's recent trend lowers pressure on the central bank for it to restrict monetary policy," Banchile Inversiones said in a note to clients. Concern over ebullient local consumption had led the market to forecast a rate hike in the mid-term. But the central bank's traders poll last month showed the bank is now expected to hold rates through a two-year time horizon, as the global economic outlook sours and Chile's economy appears to ease its surging growth. "The necessary conditions are present for the central bank to hold its key rate at 5 percent at its May 16 meeting and reiterate its neutral bias, which will presage a rate hold during the rest of the year," Banchile added. The bank has held the rate at 5 percent since a surprise 25 basis point cut in January 2012. The central bank forecasts Chile's economy will expand by 4.5 percent to 5.5 percent this year, easing from 5.6 percent growth in 2012. Economic growth in Latin America and the Caribbean is seen speeding up in 2013 from last year, though at a slower pace than initially forecast, the United Nations economic body for Latin America said in April. Mexico's economy slowed markedly in the first quarter of this year, hit by a slowdown in the United States, the country's finance ministry said late last month. The economy of regional giant Brazil is expected to grow 3.0 percent this year, according to the median forecast of economists in a weekly central bank poll. While that rate would be three times faster than last year's meager 0.9 percent growth rate, it would be far from the eye-popping expansion rates that lured in foreign investors last decade.
- Malaysian PM says lost airliner was diverted deliberately |
- Malaysia PM says lost plane's movements indicate a deliberate act
- Exclusive: Radar data suggests missing Malaysia plane deliberately flown way off course - sources
- UPDATE 2-Satellite data shows missing Malaysia plane may have flown thousands of miles-source
- UPDATE 1-Rolls-Royce concurs with Malaysia on missing jet's engine data