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LatinNews Daily - 14 October 2021

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In brief: Chile’s interest rate sees historic hike

* Chile’s central bank (BCCh) has raised the benchmark interest rate by a record 125 basis points to 2.75%. The decision to increase the interest rate was taken unanimously by the BCCh’s board in its latest monetary policy meeting in response to inflationary pressures. Although a rate hike was expected, the scale of the increase took economists by surprise. As justification for its doubling down on monetary tightening, the BCCh cites inflation figures for September – which came in above expectations, bringing annual inflation to 5.3% – and the depreciation of the Chilean peso as impacting inflation forecasts in the short and medium term.