Macroeconomic Forecast Chile

BMI View: After strengthening against the U.S. dollar in October, the Chilean peso returned on sharp depreciatory trend in November, losing almost 7.0% of its value since the beginning of the month to reach CLP524.95/US$ on November 23. The move, motivated by a new bout of risk aversion across emerging markets and declining copper prices, poses increasing downside risk to our end-2011 exchange rate forecast of CLP455/US$. While a move below long-term support around CLP537/US$ could prompt us to revise down our 2012 forecast of CLP445/US$, we are happy to stick with it for the time being.

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