| Add to balance / Manage account | User: | Log out |
| Prospect News home > News index > List of issuers C > Headlines for Central Bank of Chile > News item |
Chile keeps policy rate at 4½% as Chilean economy gradually weakens
By Toni Weeks
San Luis Obispo, Calif., Dec. 12 - The Central Bank of Chile decided at its Dec. 12 monthly monetary policy meeting that it will keep the monetary policy interest rate at 4½%.
The bank last lowered the rate by 25 basis points from 5% to 4½% in November.
The Chilean economy has been gradually losing strength, the bank noted. Output is growing slightly below trend, and a slowdown in domestic expenditure has been observed. The committee also noted that the peso has depreciated.
Incoming data for the global economy are consistent with the bank's monetary policy report. Although Chile's trading partners are growing somewhat below their historic average, a recovery is expected in the coming quarters, grounded on the rebound of developed economies and the stabilization of emerging markets.
Additionally, commodity price indexes showed increases in most components, including copper, over the past months, and global inflation remains low.
Market expectations are that the tapering of the U.S. Federal Reserve's asset-purchase program will begin in the coming months. U.S. long-term interest rates have risen, and the dollar has appreciated in world markets. International financial conditions remain tighter than they were in early 2013 or in previous years, with harsher effects on those more vulnerable emerging economies, the bank said.
Recent inflation indicators, as well as private expectations, are consistent with inflation converging to the target within the monetary policy. The board reiterated its commitment to conduct monetary policy with flexibility so that projected inflation stands at 3% over the policy horizon.
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.