Chile Inflation August 2017


Chile: Inflation rises in August, but remains below the Central Bank's target

September 8, 2017

Consumer prices rose 0.2% in August compared to the prior month, matching July’s figure and coming in slightly below analysts’ expectations. According to the National Statistical Institute (INE), August’s increase was underpinned by higher prices for food and non-alcoholic beverages and housing and basic services, which more than offset lower transport prices.

Inflation came in at 1.9% in August, up from July’s 1.7% in July. As a result, inflation remains outside the Central Bank’s 2.0%-4.0% tolerance range for the third consecutive month. The market took this as a sign that further monetary easing could be in the offing, with the Chilean peso losing value against the dollar soon after the announcement. After stripping out volatile categories such as oil, fresh fruit and vegetables, core consumer prices were flat month-on-month in August, contrasting July’s 0.4% rise, while core inflation was 1.9% in August, compared to 2.0% in July.

The Central Bank predicts year-end inflation of 2.4% in 2017 and 3.0% in 2018. Last month, FocusEconomics Consensus Forecast panelists expect inflation to end 2017 at 2.6% and 2018 at 3.0%. A new Forecast will be published on 12 September.

Author:, Economist

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Chile Inflation Chart

Chile Inflation August 2017

Note: Year-on-year and monthly variation of consumer price index in %.
Source: Chile National Statistical Institute (INE).

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