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CHILE: JP Morgan Expects Hawkish Guidance To Be Consistent With Extended Pause

CHILE
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  • JP Morgan expects the BCCh to keep the policy rate unchanged at 5.00% today, with a rather hawkish message in terms of forward guidance that would be consistent with a more extended pause.
  • Headline inflation is expected to hover around 4.6% y/y in the first half of the year, impacted by higher electricity prices, the contribution of which climbed to 100bp in 2024. January CPI is to print in the 0.8%-0.9% m/m range, with the incidence of electricity accounting for about 29bp.
  • With a relatively low real interest rate, and risk of additional FX passthrough, the central bank is likely to keep the interest rate parity stable.
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  • JP Morgan expects the BCCh to keep the policy rate unchanged at 5.00% today, with a rather hawkish message in terms of forward guidance that would be consistent with a more extended pause.
  • Headline inflation is expected to hover around 4.6% y/y in the first half of the year, impacted by higher electricity prices, the contribution of which climbed to 100bp in 2024. January CPI is to print in the 0.8%-0.9% m/m range, with the incidence of electricity accounting for about 29bp.
  • With a relatively low real interest rate, and risk of additional FX passthrough, the central bank is likely to keep the interest rate parity stable.