The International Monetary Fund said its Executive Board has completed the Article IV consultation for Chile, concluding that the economy remains resilient but faces slower growth, inflation pressures and continued fiscal constraints. The IMF said gross domestic product grew 2.5 percent in 2025 on strong non-mining domestic demand, while inflation returned to the central bank’s target in early 2026 before rising again because of higher energy prices linked to the conflict in the Middle East. Growth is projected to slow to 1.8 percent in 2026 before recovering to 2.6 percent in 2027, and inflation is expected to stay temporarily above target through early 2027. Executive Directors backed the authorities’ plans to reduce the structural fiscal deficit to 1.5 percent of gross domestic product by 2030 and keep debt below 45 percent of GDP, but said additional measures will be required given spending pressures. They supported expenditure rationalization, stronger spending efficiency and careful sequencing of reforms under the National Reconstruction Plan, while noting that better targeting of the minimum guaranteed pension and consolidation of fragmented social programs could improve efficiency. Directors also said the central bank should stand ready to tighten monetary policy if second-round inflation effects emerge, welcomed the reserve accumulation program, and described the financial sector as resilient and well supervised while stressing continued attention to vulnerabilities in real estate and construction and further work on outstanding 2021 Financial Sector Assessment Program recommendations. Chile’s authorities have consented to publication of the staff report, which the IMF said will be published shortly on the country page.

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