What‘s priced in: BCB likely to cut this week, BCCH on hold

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What‘s priced in: BCB likely to cut this week, BCCH on hold

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What’s priced in

BCB likely to cut this week, BCCH on hold

In Chile, the central bank meets on June 16. The market is pricing no change for the 14 June 2026

meeting. Our economist, Sebastian Rondeau, forecasts the Central Bank of Chile (BCCH) GEM FI Strategy

to keep the monetary policy rate on hold at 4.50% on June 16. Inflation came at 0.2% Global

mom in May, below consensus, showing limited second-round effects of fuel prices

Headline inflation is down to 3.9% yoy, back to the 2%-4% target range. We keep our Claudio Irigoyen Global Economist

forecasts of BCCh rates on hold this year, but we see 50bp hikes next year amid pro- BofAS

growth reforms. claudio.irigoyen@bofa.com

David Hauner, CFA >>

In Brazil, the central bank met on June 11. The market is pricing a 15bp of cut for the GlobalMLI (UK)EM FI/FX Strategist

meeting. Our economist, David Beker, forecasts the Central Bank of Brazil (BCB) to david.hauner@bofa.com

deliver one final 25bp cut to the Selic rate, followed by a long pause. This forecast is the Claudio Piron

result of deteriorating current inflation dynamics, rising inflation expectations, and a EmergingMerrill LynchAsia(Singapore)FI/FX Strategist

weaker BRL. At the same time, activity remains supported by continued fiscal and credit, claudio.piron@bofa.com

delaying the necessary adjustment in demand conditions. Pedro Diaz

Caribbean Economist

BofAS

pdiaz2@bofa.com

Chart 1: 12-month priced-in policy rate change vs BofA forecasts GEMsBofAS FI Strategy & Economics

Our forecasts are more dovish than market expectations See Team Page for List of Analysts

115 114

125 125

75 51 75

39 37 33 31

25 12 11 8 25

-25 -25

-16

-75 -75

Hikes Cuts BofA -76

-125 -125

-117

-175 -175