Chile : Cenbtral Bank says inflation should end year at about 3 pct

SANTIAGO : Inflation in Chile should end the year closer to 3 percent, instead of 3.5 percent as the central bank previously expected, the bank’s vice president was quoted as saying in local newspaper El Mercurio on Sunday.

Sebastian Claro also told the paper that there would not likely be significant changes to economic growth forecasts in an upcoming report by the central bank.

But inflation below the central bank’s target of 3 percent in 2017 would not necessarily merit a change to the interest rate, Claro said in the interview – echoing remarks by central bank head Rodrigo Vergara on Thursday.

“What could justify a movement … is an expectation that inflation will remain low in 2018,” Claro was quoted saying, adding that the bank would also have space for a rate cut if an economic recovery takes longer than expected.

The central bank’s inflation tolerance range is 2 to 4 percent. The consumer price index eased to 2.8 percent in October.