Chile’s CB Sees Higher Inflation

Chile’s central bank said inflation will be 3 percent this year, above its previous forecast of 2.3 percent, as oil prices surge and domestic demand from business and consumers rises. The bank, which meets September 8 to decide whether to change its benchmark rate, reiterated the expectation that it will increase the rate gradually. Interest rates will rise to a “neutral” stance, in terms of economic stimulus, by August 2007, the bank said.