Chile Economy Shrinks 0.2% as Mining Slump Drags Down Growth
Chile's GDP fell 0.2% in the second quarter as mining slumped, prompting recession talk the central bank's own quarterly data do not fully support. The post Chile Economy Shrinks 0.2% as Mining Slump Drags Down Growth appeared first on The Rio Times .
The Chilean economy contracted 0.2% year-on-year in the second quarter of 2026, according to the Banco Central de Chile. The decline was primarily driven by a slump in the mining sector, particularly copper production, which saw lower output. While exports and household spending also weakened, non-mining activity and overall growth remained somewhat stable.
The central bank avoided labeling this period as a recession, as it would require two consecutive quarters of shrinking output, a technical definition. By that standard, Chile did not meet the two-quarter decline threshold, as the first quarter saw a slight decline of 0.3%, followed by a flat second quarter. Despite the slowdown, the current account deficit, the gap between Chile's earnings and spending abroad, is projected to narrow this year, reaching around 1.5% of GDP.
Chile's total external debt reached approximately US$282.29 billion in the first quarter, with a significant portion owed by private companies. The outlook for the second half of 2026 will largely depend on the global copper market and demand.
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