Chile cuts rates to record low 0.5%

Central bank expands banking bond purchases to $5.5 billion, GDP expected to shrink by 5% quarter on quarter

Central Bank of Chile
Photo: Central Bank of Chile/Wikimedia Commons

The Central Bank of Chile cut interest rates to record-low levels on March 31 and expanded asset purchases in a bid to support the economy during the Covid-19 crisis.

The institution’s board unanimously decided to lower the monetary policy rate by 50 basis points to 0.5%, “its technical minimum”. Additionally, rate-setters announced a $4 billion increase in banking bond purchases, which they will amount to $5.5 billion. It also removed maturity constraints from these operations.

“The sudden

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