The Central Bank of Chile maintained yesterday, Tuesday, the monetary policy interest rate (TPM) at 11.25 percent, after 11 consecutive hikes and stagnating at this figure last December, to control the inflation affecting the South American country.
The monetary regulator pointed out in a statement issued this day that on the external front, until the beginning of March, there was an environment with better prospects for world growth and greater concern about inflation, mainly because underlying indicators remained at high levels in several economies.
Likewise, global financial markets showed significant fluctuations in the last month, reversing the better tone observed until the beginning of March.
They detailed that the Chilean economy is adjusting slower than expected at the local level, and inflation is taking longer to reduce.
“In February, total and core inflation stood at 11.9 and 10.7 percent y/y, respectively. While total inflation has declined, core inflation has remained at similar levels for several months,” he specified.
For this reason, the Central Bank of the South American country agreed to maintain the TPM at 11.25 percent until the state of the macroeconomy indicates that the process of convergence of inflation to the 3 percent target has been consolidated.
The TPM is a tool to halt inflation levels by cutting monetary stimulus.
Its elevation means that it will be more expensive to get into debt in the country, in addition to slowing the growth of some sectors, such as real estate, hit by rising inflation.
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