Chile: Central Bank continues to raise interest rates
November 16, 2010
At the policy meeting on 16 November, the Central Bank of Chile lifted the policy rate by 25 basis points from 2.75% to 3.00%, in a decision widely expected by the market. The decision follows on a 25 basis point increase in October and marks the sixth consecutive monthly increase. According to the Bank, the appreciation of the peso is reducing price pressures from abroad, prompting inflation to remain below expected levels this year. However, monetary authorities added that economic activity continues to expand at a robust pace, which threatens to push inflation above the Bank's 3.0% target next year. The Central Bank stated that it will continue to reduce the current monetary stimulus in the coming months.