Costa lowers Chile's growth outlook as domestic demand weakens
Central Bank of Chile Governor Rosanna Costa said weaker consumption and investment prompted another reduction in the 2026 growth outlook. Inflation has followed forecasts despite higher commodity prices linked to the Middle East conflict.
Domestic demand loses momentum
Rosanna Costa, Governor of the Central Bank of Chile, presented the third Monetary Policy Report of 2026 to the Senate in Santiago on September 9, 2026.
The bank again lowered its growth outlook for the year as the economy lost momentum.
Early supply disruptions were compounded by a deteriorating labor market, declining confidence and weaker consumption and investment.
In late 2025, the bank had projected growth of 2 to 3 percent and inflation around 3 percent for much of 2026.
The Middle East conflict and higher oil and other commodity prices changed that outlook.
Inflation has since followed forecasts, but under different conditions from those initially anticipated.
Copper and reconstruction underpin recovery
Costa said Chile entered the commodity shock with inflation close to target and without major macroeconomic imbalances, leaving it well placed to absorb the impact.
The global economy proved more resilient than anticipated, supported by investment in artificial intelligence development and adoption.
The bank projects a return to faster domestic growth, supported by an investment rebound underpinned partly by the recently approved Reconstruction Law and high copper prices.
Inflation holds its course
The report separates inflation tracking forecasts from a weakening domestic economy.
Costa attributes the growth downgrade to softer demand alongside supply disruptions and labor market deterioration.
The projected recovery rests on renewed investment.
Source: Chile's September 2026 Monetary Policy Report
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