Chile’s central bank kept its main interest rate unchanged as the economic growth reduced need for an interest rate cut. The Chilean peso was flat versus the US dollar, while rose against the euro.
The Central Bank of Chile decided to keep the benchmark monetary policy interest rate at 5 percent on its last policy meeting. The bank said in the statement:
Domestically, economic activity and domestic demand have tended to outperform forecasts from the latest Monetary Policy Report.
Chile’s economy grew 6.3 percent last year, beating the forecast of 6.2 percent. Policy makers still believe that growth will slow to between 3.75 percent and 4.75 percent this year. Europe, unsurprisingly, is the main foreign downside risk. The central bank wrote:
Internationally, advanced economies are growing slowly. Some output and employment indicators in the United States have shown signs of increased dynamism, while in Europe indicators have worsened. Doubts persist about how problems will be resolved in the Eurozone economies, where fiscal and financial risks remain very high.
USD/CLP stayed at its opening level of 484.7500 as of 1:03 GMT today. At the same time, EUR/CLP slipped from 633.3750 to 632.9650.
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