Chile’s Latest Current Account Deficit Widens: November 2025 Analysis
Table of Contents
Chile’s current account balance for November 2025 posted a deficit of -4.60 billion CLP, according to the latest release from the Sigmanomics database. This figure notably overshot the consensus estimate of -4.10 billion CLP and deepened from the previous -3.25 billion CLP recorded in August 2025. The widening deficit signals increased external vulnerabilities amid a challenging global environment.
Drivers this month
- Commodity export revenues declined due to softer copper prices, a key export for Chile.
- Rising import bills driven by higher energy and intermediate goods costs.
- Weaker global demand from key trading partners, notably China and the US.
Policy pulse
The current account deficit now stands well below the 12-month average of -2.80 billion CLP, indicating a deterioration in external balances. This poses a challenge for the Central Bank of Chile, which has been tightening monetary policy to curb inflation but must now weigh external stability risks.
Market lens
Immediate reaction: The Chilean peso (CLP) depreciated by 0.40% against the USD within the first hour post-release, reflecting market concerns over the larger-than-expected deficit. Sovereign bond yields edged higher, signaling increased risk premia.
Chile’s macroeconomic backdrop remains mixed as core indicators reveal tensions between growth and external pressures. GDP growth slowed to an estimated 1.80% YoY in Q3 2025, down from 2.30% earlier in the year. Inflation remains elevated at 5.10% YoY, prompting the Central Bank to maintain a restrictive stance.
Monetary Policy & Financial Conditions
The Central Bank’s benchmark rate currently stands at 9.25%, unchanged since September 2025. Financial conditions tightened as credit spreads widened and the CLP weakened, reflecting external account concerns. Inflation expectations remain anchored but vulnerable to imported inflation via the current account deficit.
Fiscal Policy & Government Budget
Fiscal consolidation efforts continue, with the government targeting a primary surplus of 1.50% of GDP in 2025. However, increased spending on social programs and energy subsidies may limit fiscal space. The widening current account deficit could pressure the government to reassess external financing needs.
External Shocks & Geopolitical Risks
Global copper prices fell 7% MoM, driven by slowing demand in China and supply chain disruptions. Additionally, geopolitical tensions in Latin America and trade uncertainties with the US add layers of risk to Chile’s external position.
This chart highlights a clear trend of increasing external imbalances, reversing the temporary improvement in early 2025. The sharp deficit expansion signals heightened vulnerability to external shocks and may pressure the CLP and sovereign credit metrics going forward.
Market lens
Immediate reaction: The CLP depreciated sharply post-release, with the USD/CLP rate rising 0.40%. Chilean sovereign bond yields increased by 12 basis points, reflecting investor caution. Equity markets showed muted response, with the IPSA index down 0.30%.
Looking ahead, Chile faces a complex macroeconomic environment shaped by external and domestic factors. The current account deficit trajectory will be a key barometer of external stability and policy effectiveness.
Bullish scenario (20% probability)
- Commodity prices rebound, boosting export revenues.
- Global demand recovers, narrowing the deficit to below -2 billion CLP by mid-2026.
- Monetary policy remains effective in containing inflation without stifling growth.
Base scenario (55% probability)
- Current account deficit stabilizes around -4 billion CLP through 2026.
- Moderate growth and inflation persist, with gradual fiscal adjustments.
- CLP remains volatile but contained within a manageable range.
Bearish scenario (25% probability)
- Prolonged commodity price weakness and external shocks deepen the deficit beyond -5 billion CLP.
- Inflation pressures force more aggressive monetary tightening, risking recession.
- Fiscal pressures mount, increasing sovereign risk premiums and currency depreciation.
Policy makers must balance inflation control with external stability, while monitoring geopolitical developments and commodity markets closely.
Chile’s November 2025 current account deficit signals a return to external vulnerabilities after a brief respite. The widening gap reflects both cyclical and structural challenges, including dependence on volatile commodity exports and rising import costs. Monetary and fiscal policies face a delicate balancing act amid global uncertainties.
Structural reforms to diversify exports and improve productivity remain critical for long-run external sustainability. Meanwhile, vigilant monitoring of financial markets and external shocks is essential to mitigate downside risks.
In sum, Chile’s external accounts warrant close attention as they will shape macroeconomic stability and investor confidence in the coming quarters.
Key Markets Likely to React to Current Account
The current account deficit is a vital indicator for markets tracking Chile’s external health. Key assets historically sensitive to this data include the Chilean peso, sovereign bonds, and copper-related equities. Movements in these markets often reflect shifts in external balances and risk sentiment.
- USDCLP – The primary currency pair reflecting CLP volatility post current account releases.
- BSANTANDER – A major bank with exposure to Chile’s economy and external financing conditions.
- COPEC – Energy sector leader sensitive to import costs and commodity price shifts.
- BTCUSD – Reflects risk appetite shifts that can influence emerging market currencies like the CLP.
- EURUSD – A global risk barometer impacting capital flows to emerging markets including Chile.
Frequently Asked Questions
- What does Chile’s current account deficit indicate?
- The current account deficit signals Chile’s net external financing needs and reflects trade and income flows with the rest of the world. A widening deficit can indicate external vulnerabilities.
- How does the current account affect Chile’s monetary policy?
- A larger deficit may pressure the currency and inflation, influencing the Central Bank’s decisions on interest rates and financial stability measures.
- Why is the current account important for investors?
- Investors monitor the current account to assess external risk, currency stability, and sovereign creditworthiness, which impact asset prices and capital flows.
Key takeaway: Chile’s November 2025 current account deficit widening to -4.60 billion CLP highlights growing external pressures. Policymakers must navigate complex trade-offs amid volatile commodity markets and geopolitical risks to maintain macroeconomic stability.
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
The November 2025 current account deficit of -4.60 billion CLP is a significant deterioration from August’s -3.25 billion CLP and well below the 12-month average of -2.80 billion CLP. This marks the largest deficit since March 2023 (-4.50 billion CLP), underscoring a reversal of the improving trend seen in mid-2025.
Key contributors include a 5% decline in export revenues and a 6% rise in import costs, particularly energy imports. The trade balance component of the current account swung from a surplus of 0.63 billion CLP in May 2025 to a deficit of -4.60 billion CLP in November.