Chile economy weakens as storms hit copper production

Chile’s economy started the third quarter weaker than expected as winter storms disrupted mining and other activity, adding to pressure on President José Antonio Kast’s government.

Copper production fell 9.8% from June and 9.4% from a year earlier to 403,424 metric tons in July, the lowest output for that month since 2011, according to the national statistics agency.

Industrial output dropped 5.1% year over year, worse than the 1.9% decline economists expected in a Bloomberg survey. Manufacturing fell 4.9%, while retail sales rose 2.2%, about half the projected increase.

Storms in central Chile killed more than a dozen people and caused temporary stoppages at Antofagasta’s Los Pelambres mine and Lundin Mining’s Caserones operation. Lundin’s Candelaria mine was also briefly disrupted.

Antofagasta and Lundin subsequently cut their annual copper-production outlooks. Scotiabank Chile economist Jorge Selaive said growth of 0.5% to 0.75% was becoming more probable.

Chile’s unemployment rate rose to 9.5% in July, while GDP stagnated in the second quarter after contracting 0.3% in the first three months. Economists have reduced their 2026 growth forecasts to about 1%.