Alejandro Micco, economist at the University of Chile and former Undersecretary of Finance, said in an interview with Cooperativa that the 1.5% drop in July 2026 IMACEC confirms Chile's economy is on a 'very strong stagnation trajectory', pointing to a weakened labor market and collapsed consumer and business confidence. ^[1] Chile's monthly economic activity index (IMACEC) fell by 1.5% year-over-year in July 2026. ^[2] Chile's economy contracted by 1.5% in July, representing the largest economic decline in five years according to the latest Imacec data released on Tuesday, September 2026. ^[3] Micco criticized the Chilean finance minister for over-optimism after June 2026's 2.4% growth, saying 'the data were not as good as the minister believed and he sinned a bit of optimism'. ^[4] Micco said business confidence remains depressed due to lack of broad consensus on key reforms and uncertainty over future fiscal policy, and he called for improved political governance and long-term agreements to address economic issues. ^[5] Alejandro Micco explained that the drop in economic expectations is largely due to the increase in fuel prices in March, known as the 'bencinazo', which he described as a major economic shock. ^[6] Alejandro Micco noted that while Chile has experienced mediocre growth since 2012, economic expectations at the start of the José Antonio Kast government were much higher due to a consensus for change. ^[7] Alejandro Micco, an economist and former Undersecretary of Finance, stated that the root cause of the economic problem is the sharp drop in economic expectations. ^[8]