09.09.202522:07:58UTC+00Chile Holds Interest Rate at 4.75%

The Central Bank of Chile decided to maintain its benchmark interest rate at 4.75% during its August meeting, a move that was anticipated and supported by a unanimous vote. The board observed that the international landscape has mostly progressed as expected, although there are still uncertainties, particularly concerning the effects of U.S. tariffs on trade flows and their potential repercussions on economic activity and inflation. Global financial markets anticipate that the U.S. Federal Reserve will reinstate rate cuts this month, which is expected to lead to lower interest rates and overall stock market gains.

On the domestic front, Chile experienced moderate GDP growth in the second quarter, primarily fueled by investment and private consumption. However, the labor market presents mixed signals, with an unemployment rate of 8.7%. Although the total inflation rate is on a downward trend, core inflation remains higher than anticipated, necessitating careful observation. The Central Bank reiterated its commitment to maintaining a flexible monetary policy, with the aim of achieving a projected inflation rate of 3% over the next two years.