One of the main indicators used to assess economic growth is the evolution of Gross Domestic Product (GDP), which measures the monetary value of all final goods and services produced within a given period. Changes in GDP help determine whether economic activity is expanding or contracting over time. On May 18, the Central Bank of Chile reported that the country’s GDP fell by 0.5% in the first quarter of 2026, pointing to a weakening economy. In response, and while defending his government’s sweeping economic and tax reform package, Finance Minister Jorge Quiroz was quick to blame the previous administration, stating that “this is the country we inherited, and that is precisely why we need to return to growth.”
Such statements reflect only a partial reading of the data and overlook the underlying dynamics and rhythm of Chile’s economy. Chile’s economic activity follows a cyclical quarterly pattern—much like the heartbeat recorded on an electrocardiogram—as production fluctuates over time under the influence of both structural factors and seasonal variations.
As a small, open economy, Chile is particularly sensitive to changes in the international environment, especially fluctuations in copper prices, global financial conditions, fuel prices, and external demand. Throughout the year, predictable seasonal patterns also emerge in sectors such as agriculture, tourism, retail, education, and various services, generating regular increases and decreases in production and consumption during specific quarters.
Indeed, comparing the first quarter of 2026 with the same period in 2025 reveals a 0.5% decline. But this is hardly an exceptional event. Similar year-over-year declines in quarterly GDP have occurred repeatedly in Chile. The same pattern was observed under President Gabriel Boric in March 2023 (-0.047%), under Sebastián Piñera in March 2020 (-0.40%), and under Michelle Bachelet in March 2017 (-0.37%). These fluctuations simply reflect the economic conditions each administration inherited or encountered during its term.
There are, however, other ways to interpret the data. Looking at quarterly GDP measured at current prices, there has been a strong upward trend since September 2020, although it follows the same recurring pattern of rises and falls. Viewed in isolation, this could create the impression that Chile’s economy has been growing rapidly.
To determine whether GDP growth reflects genuine economic expansion or merely higher inflation, economists use chained-volume GDP, which measures current production using the previous period’s prices. This approach provides a more accurate picture of real economic output. To make quarter-to-quarter comparisons even more meaningful, analysts also use seasonally adjusted GDP—that is, chained-volume GDP with the effects of holidays, vacations, Easter, summer, and other calendar-related fluctuations removed. Using this measure, GDP actually grew by 0.2% between the first quarter of 2025 and the first quarter of 2026.
Another useful comparison is between consecutive quarters. From the fourth quarter of 2025 to the first quarter of 2026, GDP at current prices declined by 4.11%, chained-volume GDP fell by 7.49%, and seasonally adjusted GDP decreased by 0.26%. However, comparing the fourth quarter with the third quarter of 2025 tells a different story: GDP at current prices increased by 11.80%, while chained-volume GDP rose by 10.35%.
Using economic data selectively can generate unnecessary concern and uncertainty among citizens, financial institutions—both domestic and international—and political actors. Given the cyclical nature of Chile’s economy, it is highly likely that political leaders will eventually claim that any recovery in economic growth during 2026 results from their own policies and reforms, rather than from the economy’s expected cyclical behavior.
Data matter, and for many they constitute a language of their own. Yet data do not possess inherent meaning or speak for themselves. It is people who assign meaning through processes of selection, organization, and interpretation. Like any language, data facilitate communication among those who understand their codes and analytical tools. Those who do not share that expertise must inevitably rely, to varying degrees, on the explanations provided by others.
As a result, unequal access to the ability to interpret data can create significant asymmetries of knowledge and power, benefiting those who act as interpreters and gatekeepers of information over those who depend on their interpretations to understand reality and make informed decisions.
Autor
Economist. Professor of the Department of Sociology, Political Science and Public Administration of the Catholic Univ. of Temuco (Chile). PhD in Social Science Research from FLACSO-Mexico.
