Chile again holds rate at 3½%, eyes 3% inflation over policy horizon

By Susanna Moon

Chicago, Aug. 12 – The Central Bank of Chile’s board again maintained the monetary policy rate at 3½% at its monthly meeting in August.

Inflation outpaced expectations for July, but the annual Consumer Price Index “variation returned to the tolerance range,” according to a bank statement, with expected inflation two years out still at 3%.

Meanwhile, monetary and financial conditions continue to be “expansionary” and long-term interest rates low amid a growing “appetite for risk in global financial markets, particularly for emerging economies’ assets,” the bank noted.

On the whole, global growth prospects remain unchanged, the bank said.

The bank said it is committed to working toward a projected inflation of 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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