Investors will welcome Chile’s new right-wing President José Antonio Kast – who will be sworn into office on Wednesday – but we doubt that he’ll be able to reinvigorate the copper sector and carry out his ambitious public spending cuts as quickly as he envisages. Fiscal policy is still set to be a lot tighter this year compared to last. Taken together with the terms of trade shock from the recent energy price spike, GDP growth is unlikely to accelerate to 4% p.a. as envisaged by the Kast team.
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