Chile Seen Hiking Rates

Chile’s monetary policy committee will likely hike its benchmark interest rate 50bp to 7.25% this Thursday, according to Goldman analysts. “The central bank seems committed to sending a strong signal that it is determined to get a solid grip on the deteriorating inflation dynamics following another large and broad-based inflation surprise in June,” says the shop. The rate increase is likely to trigger an additional deterioration of inflation expectations, say the shop’s analysts. In its June 10 meeting, the central bank increased the benchmark interest rate by 50bp to 6.75% from 6.25%.