07:17 AM EDT, 08/20/2024 (MT Newswires) -- The Chilean Central Bank (BCCh) will announce its monetary policy decision on Sept. 3 and Deutsche Bank revised its call and now expects the BBCh to reduce the policy rate by 25 bps, setting it at 5.50%.

The bank remains of the view that a more prudent course of action would imply waiting for additional information (specifically, the

August-September inflation prints) to evaluate the second round effects from the electric tariff hikes on core inflation and confirm the United States Federal Reserve cut, BCCh's Council has effectively signaled that the period to re-think the convenience of resuming cuts runs until the publication of the next monetary policy report (IPoM).

Since Deutsche Bank believes it's reasonable to assume that the revised macroeconomic picture will be supportive with an additional cut, the bank now expects the BCCh to act accordingly by cutting 25 bp and also indicating that further cuts will be

contingent on the adherence of incoming data to its baseline

projections.

A 25 bps cut, in addition, would be consistent with the existing space for additional cuts and the forward guidance that the BCCh

provided in its last decision signaling its intent to resume cuts

opportunistically, added Deutsche Bank