Chile

BMI View: January's print shows the first positive month-on-month growth in Chile's benchmark consumer price index, of 0.5%, since October. However, in year-on-year terms prices continued to fall, posting a contraction of 1.3%, indicating that deflationary pressures remain at the fore. Going forward, we believe that goods shortages in the aftermath of February's devastating earthquake could see a spike in prices in the short term, but are sticking to our forecast for CPI of 2.9% by end-2010 for the time being.

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