Chile’s Central Bank has cut its main interest rate to 9.5%. The unanimous decision came as global inflation slows down.
The bank issued a statement about the rate cut. It said that inflation and monetary policies differ among countries.
Developed nations plan for tight money policy for a long time. Some emerging markets have already started to cut rates.
The bank also commented on global growth. It said growth is weak for this year and next. This means less external help for Chile’s economy.
Financial markets are showing less risk-taking. Factors include the U.S. debt rating drop and economic uncertainties.
In this setting, the U.S. dollar has grown stronger. Long-term rates are up, and stock markets are down.
In Chile, the peso is weaker due to these global changes. Long-term rates in Chile rose a little. Short-term rates are still going down. Bank credit is hard to get.
The bank noted a positive turn in July’s economic activity. This was mainly due to short-term factors.
The rate cut is the second one since last December. At that time, the rate was 11.25%. The main rate helps control inflation.
A higher rate makes borrowing costly. This can hurt sectors like real estate.
The recent cut follows a previous one made in July. Before that, the rate stood at 11.25% since last December.
The bank had raised the rate eleven times before freezing it. The main rate aims to control inflation by adjusting monetary policy.
A higher rate can limit borrowing and affect various economic sectors. For instance, a high rate often slows down the real estate market.
More: Chile news in English, every day from The Rio Times.
Live Market IntelligenceChile — Live Market Board
Rio Times · Live Market Intelligence
Chile — Live Market Board
+0.61%
187,422.92
+0.44%
63,646.88
+0.17%
11,426.83
+0.61%
2,997,659
-0.04%
2,588.64
+0.90%
59,529.36
+1.84%
| Instrument | Last | Change | YoY | Prev. | High | Low | Volume |
|---|---|---|---|---|---|---|---|
| IPSA | 11,426.83 | +0.61% | — | 11,357.82 | 11,210 | 10,984 | 1,513,213,483 |
| USD/CLP | 913.98 | +0.04% | -5.67% | 913.65 | 915.11 | 906.68 | — |
| COPPER | 6.61 | +0.03% | +46.70% | 6.61 | 6.71 | 6.61 | 39,543 |
| SQM-B | 65,305 | -0.84% | +49.03% | 65,860 | 66,949 | 64,978 | 76,539 |
| COPEC | 5,964 | -1.09% | -11.70% | 6,030 | 6,100 | 5,960 | 634,331 |
| BSANTANDER | 78.37 | -2.28% | +35.94% | 80.20 | 81.69 | 78.34 | 36,288,711 |
| FALABELLA | 6,334 | -1.48% | +23.28% | 6,429 | 6,450 | 6,300 | 26,085,814 |
| ENELAM | 87.09 | +0.10% | -10.13% | 87.00 | 87.40 | 86.50 | 13,106,417 |
| CENCOSUD | 1,946 | -2.19% | -35.30% | 1,990 | 2,010 | 1,945 | 966,528 |
| CMPC | 1,020 | -1.96% | -29.10% | 1,040 | 1,050 | 1,015 | 3,526,677 |
| BANCO CHILE | 184.96 | -1.01% | +32.87% | 186.85 | 189.99 | 184.33 | 18,101,240 |
| LATAM AIR | 24.08 | -1.11% | +16.61% | 24.35 | 24.59 | 23.88 | 573,612,753 |
| SOUTHERN COPPER | 193.97 | -0.26% | +104.01% | 194.48 | 199.36 | 192.59 | 367,102 |
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