January 26, 2023 16:01 GMT
LarrainVial Expects BCCH Statement To Have Dovish Undertones
- LarrainVial expects the BCCh to keep its key monetary policy rate unchanged at 11.25% this week “though we are inclined to believe that the wording of its monetary policy outlook will be tinged with dovish undertones,” the director of research wrote.
- LarrainVial doesn’t rule out that the central bank cuts its key rate by 150-200 basis points in April and expects GDP to contract by about 4% in 1Q23 and inflation to slow down to single digits.
- They add that they see GDP contracting 2% in 2023, non-mining GDP to fall 2.8% mostly from contraction in domestic demand and lower fixed investment. GDP is expected to grow 4% in 2024.
- Current account deficit to narrow to 1.5% of GDP by Dec. 2023 from 9.9% in 3Q22 as imports fall and maritime freight rates fall as well as copper rising.