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CHILE: External Position Supported By Rebound In Copper Exports

CHILE
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  • The larger-than-expected $1.8bn trade surplus in September was supported by a 21% y/y rebound in copper exports to their highest level since end-2021. At the same time, imports continued to contract on an annual basis, albeit at a slower pace than in August, driven by a decline in energy-related goods imports. Despite this, capital goods imports posted their first annual gain in two years, and consumer goods imports picked up, pointing to some recovery in domestic demand.
  • In Itaú’s view, risks tilt to an even swifter narrowing of the current account deficit this year. This year’s trade surplus may exceed their $21bn call (the one-year rolling surplus reached $20.6bn in Sept), and place downward pressure on their 2.5% of GDP CAD forecast (vs. 3.6% last year). The recent rebound in global oil prices amid the Middle East conflict may offset some of the gains from stimulus measures in China.
  • Despite the robust trade data, a further pullback in copper today has weighed slightly on the peso, with USDCLP rising by ~0.5% to 928. The pair has pierced initial firm resistance at 924.58, the 50-day EMA, and a clear break would open 940.00 and 951.80, the Sep 10 high.
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  • The larger-than-expected $1.8bn trade surplus in September was supported by a 21% y/y rebound in copper exports to their highest level since end-2021. At the same time, imports continued to contract on an annual basis, albeit at a slower pace than in August, driven by a decline in energy-related goods imports. Despite this, capital goods imports posted their first annual gain in two years, and consumer goods imports picked up, pointing to some recovery in domestic demand.
  • In Itaú’s view, risks tilt to an even swifter narrowing of the current account deficit this year. This year’s trade surplus may exceed their $21bn call (the one-year rolling surplus reached $20.6bn in Sept), and place downward pressure on their 2.5% of GDP CAD forecast (vs. 3.6% last year). The recent rebound in global oil prices amid the Middle East conflict may offset some of the gains from stimulus measures in China.
  • Despite the robust trade data, a further pullback in copper today has weighed slightly on the peso, with USDCLP rising by ~0.5% to 928. The pair has pierced initial firm resistance at 924.58, the 50-day EMA, and a clear break would open 940.00 and 951.80, the Sep 10 high.