Chile: Central Bank leave interest rate unchanged
January 13, 2011
At the first policy meeting of the year, held on 13 January, the Central Bank of Chile left the policy rate unchanged at 3.25%. The decision to hold rates was unexpected after seven consecutive monthly increases beginning in June 2010. According to the Bank, European debt risks remain a concern in international financial markets and the slow recovery in developed countries continues to weigh on the future prospects of emerging economies. Meanwhile, the peso depreciated after last month's announcement of the foreign currency purchase program, which might raise price pressures from abroad, and thus push inflation above expected levels. The Central Bank reiterated that it will continue to reduce the current monetary stimulus over the coming months, in line with its intervention program.