High Grade Nation Slips Into Recession

Chile is the first LatAm country to officially enter into recession, says Bank of America-Merrill Lynch (BofA-ML). Fourth quarter results show that real GDP grew 0.2%, well below the shop’s consensus of 1.1% growth for the quarter. This takes annual growth in 2008 to 3.2%, less than BofA-ML’s estimate of 3.4%. “On seasonally adjusted terms, GDP contracted a larger-than-estimated 2.1% quarter-on-quarter,” says BofA-ML. “This formally confirms the expectation that, with two sequential declines, Chile is the first LatAm country to fit the definition of a technical recession,” it adds. In 2009, the bank expects Chile’s GDP to grow by only 0.2%.