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UPDATE 1-Chile central bank cuts growth forecast for 2017

Published 04/04/2017, 12:38 am
Updated 04/04/2017, 12:40 am
© Reuters.  UPDATE 1-Chile central bank cuts growth forecast for 2017
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(Adds details on growth forecasts, monetary policy outlook)

SANTIAGO, April 3 (Reuters) - Chile's central bank cut its forecast for gross domestic product growth in 2017 to a range of 1.0 percent to 2.0 percent, it said Monday, warning that a long strike at the world's biggest copper mine would likely shave off 0.2 percentage points in the year.

That compared with a previous growth estimate of 1.5 percent to 2.5 percent.

In its quarterly monetary policy report (IPoM), the bank said the 43-day-long strike at BHP Billiton Plc-owned BLT.L Escondida, which ended without a clear resolution in March, would take an entire percentage point off growth in the first quarter. produced over 1 million tonnes of copper last year, about 5 percent of the world's total, and significantly more than any other individual deposit.

Outside of the strike, persistently weak economic activity and investment in Chile has led the bank to cut the interest rate CLINTR=ECI 50 basis points so far this year, and the bank has left the door open to more stimulus.

"The base case assumes that the monetary policy rate will continue to be expansive," said central bank head Mario Marcel in a speech to senators on Monday as he presented the report.

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