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CHILE: Natixis Now Sees BCCh Hiking Later This Year, Amid Mounting CPI Pressures

CHILE
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  • Following Friday’s higher-than-expected January CPI data, Natixis now believes that the probability of a BCCh interest rate hike has increased significantly. They now forecast two hikes of 25bp, one in late in 2025 and one in 2026.
  • January's CPI came in at 1.1% m/m, bringing the annual inflation rate to 4.9% y/y, from 4.5% in December. In January, eleven of the thirteen divisions within the CPI basket contributed positively to the monthly change, with housing and basic services showing a significant increase of 2.7%, adding 0.481 percentage points to the index.
  • The report also highlights increases in food and non-alcoholic beverages, alcoholic beverages and tobacco, and clothing and footwear. The CPI excluding food and energy rose 0.8% m/m. As a result, the year-end inflation path now looks uncomfortably high. Natixis sees inflation around 4.00% y/y in December, above the 3.00% target and around the upper bound of the target band. 
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  • Following Friday’s higher-than-expected January CPI data, Natixis now believes that the probability of a BCCh interest rate hike has increased significantly. They now forecast two hikes of 25bp, one in late in 2025 and one in 2026.
  • January's CPI came in at 1.1% m/m, bringing the annual inflation rate to 4.9% y/y, from 4.5% in December. In January, eleven of the thirteen divisions within the CPI basket contributed positively to the monthly change, with housing and basic services showing a significant increase of 2.7%, adding 0.481 percentage points to the index.
  • The report also highlights increases in food and non-alcoholic beverages, alcoholic beverages and tobacco, and clothing and footwear. The CPI excluding food and energy rose 0.8% m/m. As a result, the year-end inflation path now looks uncomfortably high. Natixis sees inflation around 4.00% y/y in December, above the 3.00% target and around the upper bound of the target band.