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Goldman Forecast 2021 Year-End Policy Rate of Between 1.5-1.75%

CHILE

Goldman Sachs predict a 25bp rate hike at the July BCCh meeting, assigning a 15-20% probability of a larger 50 basis point increase.

  • Economist Alberto Ramos cites current low levels for Chile's rate, expanding fiscal stimulus, and political uncertainty as reasons for the hike.
  • Ramos says not ruling out central bank changing their stance on full policy normalization to neutrality given the outlook for Chile's economic growth and inflation, and a changing global monetary policy backdrop.
  • Goldman now expects the policy rate to rise to 1.50%-1.75% by the end of 2021, and 2.75-3.00% by the end of 2022. (Per Bloomberg Report)

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