Rates on hold in Chile

Chile's central bank held its overnight lending rate unchanged for a fifth month in a row, but suggested that higher interest rates may be necessary later this year as inflation accelerates.

Policymakers held the benchmark rate at 5%. The central bank has held rates unchanged since January as inflation remains below its inflation target, despite an acceleration of economic growth. Market expectation point to an increase in interest rates the second half of 2007.

In its policy statement the

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