Central Bank of Chile Keeps Benchmark Interest Rate at 5.25%

September 15, 2011

The Chilean monetary policy rate is reassessed each month and was left unchanged for the third time in a row.  Previously, such was hiked at 12 of 13 meetings from June 2010 to June 2011, seven times by 50 basis points and five times by 25 bps.  In a new statement, the state of monetary policy not only in Chile but around the world is summed up as follows: “Prospects for interest rate normalization in developed economies have been postponed further, while the tightening cycle in emerging market economies has been interrupted.”  Chile is in the latter case, but analysts think the next rate change could be eventually down, if the global economy continues to deteriorate.  Chilean growth has lost some momentum, and inflation is hovering near the 3% target.

Copyright 2011, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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