Shkodran Mustafi was at fault, giving the ball away under pressure from Arturo Vidal, who then engaged in a swift one-two with Alexis Sanchez, who drove the ball past Marc Andre ter-Stegen with his left boot.
Thirteen minutes after the goal, Chile's Eduardo Vargas latched on to a pass on the edge of the box, and unleashed a brilliant shot towards the goal, but it crashed against the crossbar.
After Cameroon's draw vs. Australia, the draw means that no team has clinched a berth in the knockout stage just yet. A Mexico loss and Portugal loss by more goals or by scoring the same number or fewer goals than Mexico will see CONCACAF's champions advance.
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The second half ebbed and flowed and Germany were much improved, although neither team forged clear-cut chances and both seemed content to play out a draw.
Super Stat: Germany have faced Chile thrice (1962, 1974 and 2014) in the World Cup, coming out on top on all three occasions!
It was the second 1-1 draw of the day in Group B as Cameroon and Australia also finished level.
Chile coach Juan Antonio Pizzi agreed that both teams played well in what was a very technical game.
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Russian Federation were under pressure before the match began with the country's President Vladimir Putin in the gallery. It will be played at the Krestovsky Stadium in St Petersburg - the new home of Zenit .
"It was a very tactical, intense game and it was very, very demanding in that sense", said Germany coach Joachim Loew, who has taken a young squad to the tournament. "It's fair to say that Australia was a team that in a way we could fathom".
Both sides had no more than half-chances to break the deadlock with the group winners to be decided by the weekend's final round. The striker got his first goal for Germany after he netted against Australia and he believes his teammates have what it takes to get another positive result.
"Our players need the experience of playing at this level against a team like Chile", Loew said. The first 20 minutes were nearly disastrous and if we didn't have a bit of luck on our side, we could have been 3-0 down.
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Analysts owed the slump to profit booking ahead of a longer weekend as the market will stay closed on Monday on occasion of Eid. Meanwhile, the broad based NSE Nifty fell by 55.05 or 0.57% at 9,574.95 with 38 components registering drop.
Arsenal star Sanchez was fit enough only to make a second-half appearance in Chile's opening Confederations Cup win over Cameroon, having struggled to shake off an ankle problem.