MNI BRIEF: China Visitor Mobile Payments Surge in H1

MNI China Daily Summary: Friday, July 26

MNI BRIEF: Foreign Firms Content In China

MNI BRIEF: Turkish Inflation Expectations Steady- TEBA

MNI China Press Digest July 26: Deposit Rates, Fiscal, PBOC

MNI: PBOC Net Injects CNY299.05 Bln via OMO Fri

MNI: BAKER HUGHES US RIG COUNT 589; OIL RIGS 482; GAS RIGS 101

MNI: UNIV OF MICHIGAN CONSUMER SENTIMENT FINAL JUL INDEX 66.4

EZ/UK Bond Supply Calendar: BoE Short APF Operation on Monday

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

Wells Fargo Expect 75bp Cut This Week, Before BCCh Turns More Cautious

CHILE
BulletEM BulletEmerging Market NewsHomepage
  • Wells Fargo believe that BCCh will deliver another 75bp rate cut to 5.75% on Thursday and proceed with a more gradual and cautious pace of monetary easing after that.
  • Recent inflation and activity data have, in their view, been consistent with a continuing yet slower pace of rate cuts. Chilean inflation has not meaningfully eased since the April monetary policy meeting. On the other hand, economic activity data have looked a bit softer. The economic activity index for March surprised to the downside at 0.8% y/y. In terms of currency developments, while CLP has recovered somewhat recently, it still stands about 3% weaker versus the US dollar YTD in 2024.
  • Overall, while somewhat subdued economic activity could bolster the case for rate cuts, concerns around sticky inflation should, in their view, instil a sense of caution in BCCh policymakers going forward. Wells Fargo believe the BCCh will follow a 75bp move this week with a smaller 50bp cut in June and only 75bp of total easing in Q3.
166 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
  • Wells Fargo believe that BCCh will deliver another 75bp rate cut to 5.75% on Thursday and proceed with a more gradual and cautious pace of monetary easing after that.
  • Recent inflation and activity data have, in their view, been consistent with a continuing yet slower pace of rate cuts. Chilean inflation has not meaningfully eased since the April monetary policy meeting. On the other hand, economic activity data have looked a bit softer. The economic activity index for March surprised to the downside at 0.8% y/y. In terms of currency developments, while CLP has recovered somewhat recently, it still stands about 3% weaker versus the US dollar YTD in 2024.
  • Overall, while somewhat subdued economic activity could bolster the case for rate cuts, concerns around sticky inflation should, in their view, instil a sense of caution in BCCh policymakers going forward. Wells Fargo believe the BCCh will follow a 75bp move this week with a smaller 50bp cut in June and only 75bp of total easing in Q3.