Chile Macro Brief: December 2025 December marked a decisive turning point for Chile. Politically, the 14th December runoff ended months of uncertainty with a clear rightward shift under José Antonio Kast. Monetarily, the Central Bank pivoted from caution to action, cutting rates as inflation fell faster than expected. On the surface, it was a clean month. Underneath, the interaction between easing policy, tightening regulation and uneven sectoral momentum set up a far more complex start to 2026. Monetary Policy The Central Bank cut the policy rate by 25bps to 4.5% on 16th December, voting unanimously. This was the first clear step back into an easing cycle after months of pause. The Board cited faster-than-expected disinflation, improved financial conditions and a reduced near-term inflation risk profile. Crucially, this was not framed as a one-off reward. The Bank signalled that the policy rate is now moving closer to its neutral range, with future moves conditional on inflation remai...
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