According to a survey by the Central Bank of Chile (BCCh), financial operators believe that Chile’s monetary policy rate (TPM) will remain steady at 11.25% in June.
However, they forecast the beginning of a rate cut cycle starting in July, with the TPM predicted to drop to 10.75%.
In the run-up to the June Monetary Policy Meeting, the survey’s median reveals an expectation that the BCCh Board will hold the benchmark interest rate at the current level in its upcoming meeting.
But, they also predict this could be the last time in the current year the BCCh decides not to adjust the TPM.
In line with expectations of ongoing deceleration in inflation this year, the survey released on Wednesday projects the interest rate to settle at 8.25% by December 2023.
For the Consumer Price Index (CPI), financial operators anticipate a monthly variation of 0.10% in June, 0.30% in July, and 0.20% in August.
Consistent with other forecasts, the survey respondents expect inflation to converge to the 3% target in the next year.
Regarding the exchange rate, the survey’s median suggests the exchange rate will hover around 805 Chilean pesos per US dollar in the next seven days.
Over the following 28 days, it’s projected to settle around 800 pesos per dollar.