CHILE · ECONOMY
Key Facts
- —What is happening The International Monetary Fund cut its 2026 growth forecast for Chile to 0.6% from 2.4% in April, in its World Economic Outlook released on Tuesday, 13 October, El Mostrador and La Tercera reported from the IMF tables.
- —Why it matters The cut of nearly two percentage points in six months leaves Chile, the world’s largest copper producer, with South America’s weakest 2026 forecast after Bolivia, amid a cooling copper market and softer local investment.
- —The numbers The IMF tables show growth of 0.6% in 2026 and 2.6% in 2027, unemployment rising from 8.5% in 2025 to 9.5%, and average inflation of 3.7%, above the central bank’s 3% target.
- —Who is who The IMF is the global lender based in Washington, whose World Economic Outlook, published twice a year, compares economies side by side; Chile’s central bank sets interest rates and targets 3% inflation.
- —What to watch Chile’s central bank meets later in October to set interest rates, the country’s own output and jobs data for late 2026 are still to come, and the IMF has not yet explained why it cut the forecast so sharply.
- —What it means for you Slower growth can weigh on Chilean shares listed in New York, such as the lithium producer SQM, and on the peso against the US dollar, and it touches the copper and lithium supply behind US manufacturing and electric vehicle batteries.
The International Monetary Fund, the Washington-based global lender, has cut its 2026 growth forecast for Chile to 0.6%. The same outlook sees unemployment climbing to 9.5%, among the weakest readings in South America.
The International Monetary Fund has sharply lowered its growth forecast for Chile this year. Its new World Economic Outlook, released on Tuesday, 13 October, puts 2026 growth at only 0.6%.
For readers in the United States, the downgrade matters for copper supply and for Chilean shares traded in New York. Chile is the world’s largest copper producer and a close US trade partner.
The downgrade lands amid a cooling copper market and softer local investment. It adds to a run of weaker forecasts for one of Latin America’s most open economies.
What the IMF Changed
The Fund now expects the Chilean economy to grow 0.6% in 2026, down from the 2.4% it projected in April. That is a cut of nearly two percentage points in six months.
The forecast for 2027 was left unchanged at 2.6%, according to the IMF tables. In South America, only Bolivia, where the IMF sees a 3% contraction, has a weaker 2026 forecast.
The World Economic Outlook is the IMF’s twice-yearly health check on the global economy. Investors and governments use it to compare countries side by side.
Jobs and Prices Under Pressure
The IMF sees unemployment rising from 8.5% in 2025 to 9.5% in 2026. That would be close to one worker in ten without a job.
For 2027 the Fund pencils in a further rise to 9.6%, the tables show. Average inflation is seen at 3.7% this year, above the 3% target set by Chile’s central bank.
Higher joblessness tends to slow household spending across the economy. It can also raise pressure on the government to support jobs.
Who Reported the New Figures
El Mostrador and La Tercera, two Chilean outlets, reported the new figures from the IMF tables. Both cited the Fund’s World Economic Outlook published on Tuesday.
The IMF’s own DataMapper database now shows the same October figures for Chile. Earlier on Tuesday it still showed the April baseline of 2.4% growth and 8.1% unemployment.
The IMF expects Latin America and the Caribbean as a whole to grow 2.3% in 2026. By 2027, Chile’s 2.6% forecast would sit just above the regional 2.5%.
What It Means for You
For US investors, slower growth weighs on Chilean shares listed in New York, such as the lithium producer SQM. A weaker economy can also pressure the Chilean peso against the US dollar.
Chile supplies much of the copper used in US manufacturing and electronics. It also feeds the lithium supply chain behind electric-vehicle batteries in the United States.
Chile sits in the US Visa Waiver Program, so travel links are close. Weaker local demand can still affect US firms selling into the Chilean market.
What Is Not Known
The IMF has not yet set out in detail why it cut Chile’s forecast so sharply. Its tables give the new numbers but not the country-specific reasons.
It is not yet clear how fast the Fund expects growth to recover after 2027. Chile’s own quarterly output and jobs data for late 2026 are still to come.
What Comes Next
The IMF will revisit these numbers in its next World Economic Outlook in 2027. Chile’s central bank meets later in October to set interest rates.
A lower forecast is not the same as a recession, which the IMF does not predict. Much will depend on copper prices, investment and global demand in the months ahead.
Frequently Asked Questions
What Did the IMF Say About Chile?
The IMF cut Chile’s 2026 growth forecast to 0.6%, down from 2.4% in April. It also raised its 2026 unemployment forecast to 9.5%.
When Was the Forecast Released?
The figures come from the IMF World Economic Outlook published on Tuesday, 13 October. The IMF updates the outlook twice a year.
Why Does This Matter for the United States?
Chile is a top copper and lithium supplier to US industry and electric-vehicle makers. Slower growth can also weigh on Chilean shares listed in New York.
How Does This Compare With Earlier Forecasts?
In April the IMF expected 2.4% growth and 8.1% unemployment for Chile in 2026. Its new 0.6% forecast is also well below the 2.3% it expects for Latin America and the Caribbean.
Is Chile Heading Into a Recession?
The IMF still projects positive growth of 0.6% for 2026, not a contraction. A recession would mean the economy shrinking, which the outlook does not show.
Sources: IMF World Economic Outlook; IMF DataMapper, Chile; El Mostrador; La Tercera (all accessed 13 October 2026).