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Chile traders see interest rate at 1.75% for next 12 months to Jan 2021: central bank poll

SANTIAGO (Reuters) – The central bank is expected to maintain Chile’s interest rate at 1.75% for the next 12 months until at least January 2021, a monthly poll of 61 traders showed on Thursday.

Traders saw the interest rate rising to 2% only by January 2022. They saw inflation at 0.2% in December and at 3% in 12 months, and the peso at 750 per dollar in seven days and 755 per dollars in 28 days.

The predictions come amid a rough ride for the Chilean economy following more than two months of widespread protests over inequality and violence that has left 26 people dead, thousands more injured and arrested and billions of dollars´ damage wrought on the economy.

Chile’s central bankers all agreed to hold the interest rate steady at 1.75% earlier this month, saying they believed recently announced fiscal stimulus measures coupled with successive rate cuts in recent months would help bolster economic growth for 2020.

The slide in the peso <CLP=CL>, which has hit historic lows in recent weeks, would help push long-lagging inflation in the South American nation to its target without further stimulus, they added.

(Reporting by Aislinn Laing; editing by Jason Neely)

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