Central Bank of Chile

April 12, 2016

There were two 25-basis point Chilean interest rate hikes in the final quarter of 2015.  They were the first tightenings in several years, but there has been no further change in the 3.5% range since December.  A statement released after the latest policy meeting kept that level but promises further rate normalization.  Inflation of 4.5% “is expected to remain over 4% for some months. Inflation expectations two years out remain at 3%,” which is the medium-term target.  There have not been significant surprises regarding growth.  “In line with the Monetary Policy Report released in March, the Board estimates that to ensure the convergence of inflation to the target, monetary policy will need to continue with its normalization, at a pace that will depend on incoming information and its implications on inflation projections.”

Copyright 2016, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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