The Central Bank of Chile's Board voted unanimously to keep the monetary policy rate at 4.5% on Tuesday, leaving the key rate unchanged for the sixth meeting in a row. The decision matched the expectations of all 18 analysts surveyed by Bloomberg and follows a quarter-point reduction enacted in December 2025.
In explaining their assessment, the central bank highlighted an uptick in geopolitical risk stemming from escalated hostilities between the United States and Iran. Officials noted that the conflict has contributed to a sharp rise in oil prices, pushing them close to $100 per barrel. At the same time, the bank observed continued strength in copper markets, with prices moving above $6.5 per pound.
Global activity was described as resilient, particularly in economies tied to artificial intelligence production, a dynamic the bank referenced when assessing external conditions. Against that external backdrop, Chile's domestic performance has been softer than anticipated.
The central bank reported that Chile's economy remained weak through the second quarter and into the start of the third quarter, with outcomes falling short of projections set out in the June Monetary Policy Report. On the demand side, private consumption and gross fixed capital formation both contracted on a seasonally adjusted quarter-on-quarter basis during the second quarter.
Labour market indicators also deteriorated, the Board said, recording job losses alongside a rise in the unemployment rate. Those developments formed part of the bank's rationale for maintaining the policy stance rather than moving rates at this meeting.
On inflation, the bank noted that annual headline inflation increased to 4.1% in August, a rise the institution attributed mainly to volatile components. Core inflation, which strips out those more variable items, stood at 3.3% year-on-year. Two-year inflation expectations taken from both the Survey of Economic Expectations and the Survey of Financial Traders were reported at 3%.
The minutes from the meeting are scheduled for publication on Wednesday, 16 September 2026, and will provide further detail on the discussion that led to the unanimous decision to hold the policy rate at 4.5%.