Fynsa
The CPI for December registered a monthly decline of -0.2%, falling below market expectations. With this, inflation closed 2025 at 3.5% annually, just above November's figure.
Rate declines yes, but not as fast and not as steep.
The Chilean peso is particularly vulnerable to a new tariff escalation by the Donald Trump administration, given its direct link to China.
Donald Trump's surprise victory in the U.S. presidential election has left many wondering about its consequences. Will his second administration be as negative as feared?
A basis so far away from the swap hurts bank placements, so it is the basis at high levels that is the ultimate cause of tight spreads.
The Central Bank will take into account factors other than inflation in setting its monetary policy, such as the current account deficit, financial conditions, and international trade.
The Chilean economy is in such a state of imbalance that it cannot respond in the way it normally would in this type of situation.
This logic is rooted in the market playbook from past recessions, but "the world is different now; inflation is much higher."
It is likely that the focus in the second half of the year will need to be on at least two factors: inflation and interest rates.
