SANTIAGO – At its monetary policy meeting on Thursday, The Board of the Central Bank of Chile avoided surprising the market and agreed for the sixth consecutive month to keep the monetary policy interest rate at 2.5%.
In its statement, the governing body noted that “externally, the figures for activity in the third quarter are consistent with a scenario of greater dynamism. The price of oil has increased in recent weeks and the price of copper has fallen slightly, although it remains higher than expected”.
On the other hand, at the domestic level, “October inflation, 0.6%, was above expectations, partially reversing the negative surprise of the previous month”.
Given the above, the issuing institute highlighted that the annual variation of the CPI increased to 1.9%, so “short-term inflation expectations remain low and medium-term expectations have not changed much”.
The Central Bank also noted that “the figures of activity known since the publication of the September Monetary Policy Report are coherent with the baseline scenario and the monetary impulse there delineated”.
However, “inflation will remain low in the short term, a situation that could delay its convergence to the goal in the horizon of two years,” the statement added.
Given the exposed global scenario, the governing body emphasized: “The Board will evaluate with special attention this risk, already identified in the Monetary Policy Report, whose materialization would require adjustment of the MPR”.
At the same time, it reaffirms its commitment to conduct monetary policy with flexibility, so that projected inflation stands at 3% over the two-year horizon.–MercoPress