Archive

July 31, 2024
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Chile Policy Interest Rate 5.75% (consensus 5.5%) in Jul-24

  • The Central Bank of Chile kept the MPR unchanged at 5.75%, defying expectations of a 25 basis point cut due to a cautious assessment of global inflation trends and mixed signals from major economies like the US and China.
  • Domestically, financial markets mirrored global trends with lower indexed rates, a depreciated peso, and weak credit conditions. Economic activity underperformed relative to projections, and investment expectations showed signs of improvement.
  • The Board anticipates further MPR reductions contingent on macroeconomic developments, with a commitment to maintaining policy flexibility to ensure inflation remains aligned with the 3% target over a two-year horizon.

June 19, 2024
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Chile Policy Interest Rate 5.75% (consensus 5.75%) in Jun-24

  • In response to moderating global inflation and mixed signals from the US economy, the Central Bank of Chile unsurprisingly reduced the MPR by 25 basis points to 5.75%.
  • Chile's financial market mirrored global trends with slight fluctuations in long-term rates, a 3% depreciation of the peso, and stable stock prices, while domestic economic activity showed signs of recovering along its growth path.
  • Future MPR cuts are anticipated, with the pace and magnitude depending on macroeconomic developments and their implications for inflation, ensuring a flexible approach to maintaining the 3% inflation target over a two-year horizon.

May 23, 2024
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Chile Policy Interest Rate 6.0% (consensus 6.0%) in May-24

  • The Central Bank of Chile reduced its policy rate by 50 basis points to 6.0%, matching consensus expectations, as global inflation moderates and financial markets adjust to evolving Federal Reserve policies.
  • Chile's financial market mirrored global trends, with increases in long-term rates and stock prices, a significant appreciation of the peso due to rising copper prices, and mixed credit conditions reflecting both the MPR cuts and persistent high mortgage rates.
  • Future interest rate cuts are anticipated, contingent on the macroeconomic scenario and inflation trends, with the Board committed to maintaining flexibility to ensure projected inflation aligns with the 3% target over a two-year horizon.

April 02, 2024
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Chile Policy Interest Rate 6.5% (consensus 6.5%) in Apr-24

  • The Central Bank of Chile reduced its MPR by 75 basis points to 6.5%, aligning with consensus expectations amid downward global inflation trends, yet noting risks from transportation and fuel costs.
  • Domestically, the economy shows mixed signals with better-than-expected activity but subdued demand and investment, alongside an economy reflecting global financial market trends with adjustments in interest rates and currency depreciation.
  • The Board anticipates further reductions in the MPR, considering the macroeconomic scenario and inflation trajectory, emphasizing the need for a flexible policy approach in response to transient inflationary pressures and external economic risks.