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Banco Central Chile: Oct-23

• The Central Bank of Chile reduced the monetary policy interest rate by 50 basis points to 9%, influenced by tightening global financial conditions, U.S. monetary policy, and geopolitical uncertainties.
• Domestic factors, including a weakening labor market, modest consumption and investment, and easing inflation, also played a role in this decision, aligning with the bank's inflation target of 3%.
• Future interest rate policies will hinge on global financial volatility, domestic economic performance, and inflation dynamics, with the bank vigilantly steering towards its inflation target amidst global and local challenges.

Chile CPI Inflation 0.7% m-o-m (consensus 0.6%) in Sep-23

- Chile's CPI inflation rose by 0.7% month-on-month in September 2023, the highest growth seen since March 2023 and a tenth above the consensus expectation.
- This increase of 0.29 percentage points above the one-year average suggests a notable deviation from recent trends and historical norms.

Chile Economic Activity Growth -0.9% y-o-y (consensus 0.1%) in Aug-23

- Chile's economic activity growth declined by 0.9% year-on-year in August 2023, marking the lowest growth rate since June 2023, contrary to consensus expectations for 0.1% y-o-y growth.

Chile unemployment rate 9.0% in Aug-23

- The unemployment rate in Chile reached 9.0% in August 2023, the highest level since June 2021.
- The current unemployment rate is 0.62 percentage points above the one-year average and 1.50 percentage points above the long-run average, indicating ongoing challenges in the labor market.