On Friday, central bank data showed that Chile’s economy posted in Q3 its largest sequential fall in more than two years as recession concerns grow in the world’s largest copper producer.

The data revealed that the GDP contracted 1.2 per cent from Q2. This is the country’s largest decrease since Q2 of 2020, when the economy fell 13 per cent as the COVID-19 pandemic hit the Andean country. Economists had expected a 1.0 per cent quarter-on-quarter decline.

Chile’s economy recovered rapidly from the pandemic-induced downturn but was then hit by rising inflation, leading the local central bank to raise interest rates aggressively to the current 11.25 per cent.

On a yearly basis, the economy of the world’s largest copper producer expanded 0.3 per cent in Q3, slightly above expectations of a 0.2 per cent gain.