Monetary Policy Report (IPoM)

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Monetary Policy Report March 2026

Informe de Política monetaria

During the past few months, the Chilean economy evolved as expected. By the end of 2025, activity expanded at a pace consistent with its potential growth, and February inflation was somewhat below 3%. However, the war in the Middle East has resulted in considerably higher external energy prices and has added a high degree of uncertainty for the outlook of both local and global economies, after a period of greater external boost at the beginning of the year. With the information at hand at the statistical cut-off, in the central scenario inflation will see a significant increase in the second quarter mainly related to the higher international fuel prices. Regarding activity, various factors would influence its evolution: the new international scenario, the fiscal spending adjustment announced by the government in mid-March, and supply-side factors in sectors like agribusinesses and mining. Thus, the GDP growth range forecast for this year is lowered to 1.5%-2.5% (2%-3% in December). The macroeconomic scenario is subject to a higher-than-usual degree of uncertainty. Therefore, the Board estimates that constant assessment of alternative scenarios will be needed where the reactions of the local and world economies may configure inflationary pressures different from those expected and require changes in monetary policy. Thus, the future evolution of the MPR will be analyzed meeting by meeting based on how events unfold. The Board reaffirms that it will make every decision necessary to meet its objective of ensuring that projected inflation stands at 3% over a two-year horizon. In any case, the starting point of the Chilean economy is such that it allows it to better confront complex developments.

Monetary Policy Report March 2026

What does this MP Report tell us?

The Chilean economy is growing at capacity, and inflation has, after a prolonged period, returned to levels somewhat below the 3% target.

The Chilean economy is growing at capacity, and inflation has, after a prolonged period, returned to levels somewhat below the 3% target.

However, the war in the Middle East has impacted on the world economy and heightened uncertainty.

However, the war in the Middle East has impacted on the world economy and heightened uncertainty.

This will entail a rise in inflation due to the increases in global fuel prices.

This will entail a rise in inflation due to the increases in global fuel prices.

In this context, the Central Bank of Chile will continue to monitor the evolving situation to ensure that inflation remains low and stable.

In this context, the Central Bank of Chile will continue to monitor the evolving situation to ensure that inflation remains low and stable.

The Chilean economy is growing at capacity, and inflation has, after a prolonged period, returned to levels somewhat below the 3% target.

The Chilean economy is growing at capacity, and inflation has, after a prolonged period, returned to levels somewhat below the 3% target.

  • Inflation —i.e., the general price level increase— converged to its target in early 2026, with a slightly faster reduction than expected, hitting 2.4% in February.
  • Meanwhile, the economy closed 2025 with GDP growth of 2.5%, in line with forecasts.
  • Household consumption maintained its growth pace, thanks to improved expectations and steady wage increase, despite moderate job creation.
  • For its part, investment continued to grow, driven mainly by the mining and energy industries.
However, the war in the Middle East has impacted on the world economy and heightened uncertainty.

However, the war in the Middle East has impacted on the world economy and heightened uncertainty.

  • The outbreak of the war affected international fuel prices significantly, which rose considerably.
  • Among them, oil saw its price rise substantially over the past few weeks, which will have inflationary effects on economies around the world, including ours.
  • This situation also affected financial indicators in the world and in Chile, where the peso reversed almost all the appreciation it displayed in the first two months of 2026.
This will entail a rise in inflation due to the increased global fuel prices.

This will entail a rise in inflation due to the increased global fuel prices.

  • In Chile, the rise in gasoline prices will push up inflation, which could reach levels around 4% annually in the months to come.
  • It is estimated that it will go back to nearly 3% in the second quarter of 2027.
  • Activity growth will be lower in 2026, reflecting the new international scenario, the reduced fiscal spending, and the weaker performance of mining.
  • This scenario is subject to a higher-than-normal degree of uncertainty, making it necessary to analyze alternative scenarios.
In this context, the Central Bank of Chile will continue to monitor the evolving situation to ensure that inflation remains low and stable.

In this context, the Central Bank of Chile will continue to monitor the evolving situation to ensure that inflation remains low and stable.

  • The Board of the Central Bank considers that monetary policy implementation requires a continuous review of all scenarios and their implications.
  • The evolution of the monetary policy rate (MPR) will be assessed meeting to meeting based on how events unfold.
  • The Board reaffirms its commitment to maintaining low and stable inflation, with the aim of ensuring the well-being of every family.
Presentations
Presentación Informe de Política Monetaria Marzo 2026, ante la Comisión de Hacienda
 
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