Chile holds rate at 3½%, aims to keep rate at 3% over policy horizon

By Susanna Moon

Chicago, Sept. 16 – The Central Bank of Chile’s board again maintained the monetary policy rate at 3½% at its monthly meeting in September.

The decision comes amid low long-term interest rates and “favorable” monetary and financial conditions despite some volatility, according to a bank notice.

“On the activity side, the weakness of recent indicators in the United States and the improvement of Chinese figures stand out,” the release noted. “Beyond fluctuations, the prices of copper and oil are similar to those of a month ago.”

Meanwhile, annual Consumer Price Index inflation fell to 3.4%, which is in line with forecasts, the bank noted.

Inflation is expected to remain at 3% two years out and the bank said that it will act “with flexibility” to maintain the rate at 3% over the policy horizon.

The bank last raised the rate by 25 basis points to 3½% on Dec. 17, 2015.

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