SANTIAGO (Reuters) – Chile’s central bank cut its benchmark interest rate on Tuesday by 75 basis points to 6.50%, in a unanimous decision by its governing board, saying the rate would likely be reduced further.
The cut is in line with forecasts in a traders’ poll last week, which also predicted that the bank will reduce the rate to 4.25% within 12 months.
In a statement, the bank said it foresees further monetary policy rate cuts, with the magnitude and timing of those moves taking into account the “evolution of the macroeconomic scenario and its implications for the trajectory of inflation.”
The central bank said inflation expectations are aligned with its 3% target, adding that “rising inflation figures at the beginning of the year and higher imported cost pressures emphasize the need to continue closely monitoring its evolution.”
(Reporting by Brendan O’Boyle, Natalia Ramos and Kylie Madry; Editing by Anthony Esposito)
