Interest Rate in Chile

Chile Interest Rate | Economic News & Forecasts

Chile - Interest Rate

Central Bank resumes tightening cycle in January

At its 30 January monetary policy meeting, the board of the Central Bank of Chile (BCCh) voted unanimously to hike the key policy rate from 2.75% to 3.00%. The decision came in line with analysts’ expectations and was driven by upbeat domestic activity in the fourth quarter.

Although inflation closed the year further below the midpoint of the Bank’s 2.0%–4.0% target rate (December: 2.6%), an acceleration in non-mining activity prompted the board to resume its tightening cycle after a pause in December. The BCCh remarked that regained dynamism in investment-related sectors, particularly in capital goods imports and construction, allows for a “gradual withdrawal” of monetary stimulus. The board’s tightening came against the backdrop of a relaxation in monetary policy in the world’s biggest economies.

In its communiqué, the BCCh signaled that further policy tightening was still on the cards, albeit at a more gradual pace as the economy adjusts to a more volatile global economy. The board will pay heed to changes in monetary policy abroad, as it moves towards a neutral policy that encourages inflation to converge at the target rate of 3.0%. Analysts expect the board to keep rates unchanged at the next monetary policy meeting scheduled for 29 March.

The BCCh sees inflation ending 2019 at 2.8 and 2020 at 3.0%. LatinFocus Consensus Forecast panelists expect the policy rate to increase gradually going forward, ending 2019 at 3.61% and 2020 at 4.074.07%.

Chile - Interest Rate Data

2013  2014  2015  2016  2017  
Policy Interest Rate (%)4.50  3.00  3.50  3.50  2.50  

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Chile Interest Rate

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Bond Yield4.27-0.44 %Mar 11
Exchange Rate670.70.05 %Mar 11
Stock Market26,808-0.67 %Mar 11

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