Chile November Consumer Prices Rise 0.3%, More Than Forecast

Chile’s consumer prices rose 0.3 percent in November from the month before, pushing up annual inflation, the National Statistics Institute said.

The median estimate of 14 economists surveyed by Bloomberg was for consumer prices to rise 0.1 percent in November from October. Annual inflation quickened to 3.9 percent from 3.7 percent in October and monthly core inflation was 0.2 percent, the institute said in a report today.

The central bank, which targets 3 percent inflation, has kept borrowing costs unchanged at 5.25 percent since July. Inflation has accelerated every month since then, even as the economy weakens, expanding at its slowest pace in more than 18 months in October. The government and central bank are prepared to stimulate the economy if Europe’s debt crisis damps growth further, policy maker Manuel Marfan said Dec. 5.

“We are worried about the north wind in the global economy and how the transmission mechanisms can arrive to our coast,” he said in an interview in Santiago. “We have a very maneuverable set of policies with lots of degrees of freedom both on the fiscal side and the monetary side.”

Two-year interest rate swaps, which reflect traders’ view of average borrowing costs, fell 2 basis points to 4.28 percent yesterday.

While Chile has left rates unchanged, Brazil has cut three times since August. Brazil’s gross domestic product contracted 0.04 percent in the third quarter from the previous three months, compared with an expansion of 0.64 percent in Chile.

To contact the reporter on this story: Randall Woods in Santiago at rwoods13@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net

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