CLP Gains After Constitutional Council Election Results, Chile's CPI Eases To Single Digits

USD/CLP has come under pressure on a combination of wider greenback weakness and local developments, which include the results of an election to Chile's Constitutional Council. The spot rate last changes hands -4.45 figs at CLP789.93, hovering above support from a tentative trendline drawn off Feb 3 low and intersecting at CLP787.53.

• The conservatives claimed a sweeping victory in the election to Chile's Constitutional Council in a serious setback for progressive President Gabriel Boric. They won 33 seats in the panel entrusted with writing a new constitution, securing the three-fifths majority needed to approve articles. Leftist candidates captured 17 seats and one seat was taken by an indigenous candidate. The panel will work on an outline drafted by experts between June and November, before a mandatory referendum on the final text is held on December 17.
• On the data front, Chile's CPI inflation decelerated to +9.9% Y/Y in April from +11.1% prior versus +10.0% expected. Core CPI eased to +10.3% Y/Y from +10.8%. Headline figure reached single digits for the first time since March 2022, breaking an important psychological barrier, albeit it remains well above the +3.0% target.
• Trade surplus dwindled more than forecast to +$1.146bn in April from +$2.906bn in March, with consensus looking for +$1.975bn.