No Change to Chile Rates

Chile’s central bank has opted to leave its monetary policy rate unchanged at 0.50%, saying that the immediate effects of the recent earthquake turned out to be worse than expected, but that consumer demand is increasing faster while unemployment is decreasing. Morgan Stanley had forecast that with inflation under wraps, the central bank may choose to wait until June for further evidence of how fast the economy is rebounding from disruptions caused by the earthquake. Barclays, on the other hand, believed a 25bp hike was possible and that Chile could tighten to 6.25% by December 2012.