The Central Bank of Chile left its monetary policy rate at 4.5%, saying the upside surprise in headline CPI to 2.8% in March, firmer core inflation at 3.4% and the risk that higher oil and other commodity prices linked to the protracted Middle-East war may lift short-term inflation and its persistence outweigh subdued domestic activity. After a 25 bp cut in December 2025, the rate has been held steady at 4.5% through the first four meetings of 2026. The Board noted that February’s non-mining Imacec contracted 0.3% y/y, private consumption is tracking expectations while machinery-and-equipment investment has softened, and unemployment remains high amid slow job creation, although a survey of the Capital Goods Corporation shows a pick-up in planned investment for 2026-2029. Financial conditions have improved: equities have recovered and the peso has appreciated alongside copper trading near USD 6 per pound, even as oil prices sit above levels assumed in the March Monetary Policy Report. Globally, resilient activity contrasts with heightened geopolitical risks that could prolong elevated energy prices and keep major central banks cautious. Stressing that the macroeconomic outlook is unusually uncertain, the Board repeated that future rate decisions will be taken meeting by meeting and pledged to act as needed to secure 3% inflation over a two-year horizon.
Central Bank of Chile 2026-04-28
Central Bank of Chile keeps policy rate unchanged at 4.5%
Central Bank of Chile kept the policy rate unchanged at 4.5%, citing the March CPI uptick to 2.8%, firmer core inflation at 3.4% and geopolitical-driven commodity risks that outweigh weak domestic activity. The Board flagged unusually high uncertainty, reaffirming a meeting-by-meeting approach to ensure inflation returns to its 3% target within two years.