Central Bank introduced its monetary policy report in the USM

Henry Marshall, Counselor of the issuing Institute, reviewed the major changes that have affected the economy local in recent months, along with analysing the projections for growth and inflation. Caution and a prudent monetary policy management was the main recommendation that gave the Central Bank Adviser, Henry Marshall, in the context of his submission of the report of monetary policy (IPoM) in Frederica Santa Technical University Mary, opportunity in which also revised the elaborate projections, based on the current scenario that crosses the country, of the most relevant economic indicators.

As noted by the Ombudsman, in recent months have been significant changes in the balance of risks to the Chilean economy. “External, although he is still considered a picture of weak global growth, fears of more adverse scenarios have decreased and has been a partial recovery confidence in financial markets, while domestically, demand and activity have grown above as provided for in the December IPoM”; adding that “inflation has been above planned on that occasion and the underlying measures have normalized quickly”.

business cycle graph better

He also pointed out that “in the third quarter, the activity had a slowdown, which was then recovered, thanks to the dynamism that presented the building and trade.” “On the spending side, the greatest impact were in the accumulation of inventories and imports, although its magnitude was relatively bounded, while consumption has not been mostly affected, which relies on the State of the labour market”. “In recent months, inflation has exceeded expected.” “In part by a rapid standardization of underlying inflation and partly specific shocks of prices”, he added.

Projections

On the basis of the IPoM, Marshall indicated that the Outlook for global growth is similar to that provided in December, but with better prospects for EE.UU. and a recession more marked in the eurozone, while at the domestic level, the gross domestic product (GDP) will be in a range between 4 and 5 per cent in 2012 and not of 3.75 to 4.75 as indicated in December. “The change in the projection originates largely due to more effective business end of 2011 and early 2012,” he stressed.

It regards to inflation, it noted that it “will be higher than expected in December.” placing around 4% for a few months “In addition, the base scenario incorporates as a working assumption that the rate of monetary policy (TPM) will follow a comparable career that is deducted from the prices of existing financial assets to the statistical closure of this IPoM”.

It should be noted, that this activity was organized by the graduate of Civil Industrial Engineering, Ramón Cornejo and the pupil of the same race, Barbara Saavedra, and was sponsored by the Department of industries and the Regional Chamber of the trade of Valparaiso.