In a statement, the issuer said that all the Board members agreed that the "only plausible option for this meeting was to maintain the TPM at 5%."
The Board of the Central Bank of Chile reported that at its Monetary Policy Meeting in January, it agreed to maintain the monetary policy interest rate (TPM) at 5%. The decision was adopted unanimously by its members.
In a statement, the issuer said that all the Board members agreed that the "only plausible option for this meeting was to maintain the TPM at 5%."
The Central Bank also said that the local financial market has adapted to global trends. "Since the last meeting, short- and long-term nominal rates have increased, which contrasts with the fall in adjustable rates, especially at short terms. The peso has depreciated against the dollar, largely influenced by the evolution of this currency at a global level. The reductions in the TPM have continued to be transmitted to the interest rates of consumer and commercial bank loans. Bank credit remains weak, especially its commercial component," it said.
At the same time, he noted that according to the Bank Credit Survey for the fourth quarter of 2024, credit supply conditions remain unchanged. For its part, credit demand associated with the consumer and mortgage segments is perceived to be more dynamic, while that linked to companies is observed to be stable.
From Bank of America, they anticipated this decision: "We expect the Central Bank to remain on hold in its monetary policy, without anticipating rate hikes, since most inflationary disturbances are transitory. Recent economic data have been on the restrictive side, with an increase in inflation, GDP and retail sales, which supports the BC's decision to withdraw rate cut guidelines. However, the recent rise in the price of copper generates uncertainty about monetary policy. Inflation in January exceeded expectations, reaching 1.1% month-on-month, which raised the annual rate to 4.9%," noted BofA in a report with analysis and projections of the monetary policy of the Central Bank of Chile.
