BANREP and BCCh will likely hold this week: What‘s priced in

Research evidence excerpt

BANREP and BCCh will likely hold this week: What‘s priced in

Accessible version

What’s priced in

BANREP and BCCh will likely hold this

week

In Chile, the central bank meets on July 28. The market is pricing no change for the 26 July 2026

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

to keep the monetary policy rate unchanged at 4.50% on July 28. We expect BCCh will Global

remain on hold this year. Board members did not consider a move in rates in the last

meeting, according to the Minutes. We project 50bp hikes next year as we expect GDP Claudio Irigoyen Global Economist

growth to pick up to 3% in 2027 amid pro-growth policies. BofAS

claudio.irigoyen@bofa.com

In Colombia, the central bank meets on July 31. The market is pricing a 50bp hike for David Hauner, CFA >>

the meeting. Our economist, Alexander Muller, forecasts the Central Bank of Colombia Global EM FI/FX Strategist MLI (UK)

(BANREP) to keep the monetary policy rate unnchanged at 12.00% on July 31. In past david.hauner@bofa.com

meetings, BANREP has been blaming expansionary fiscal policy as one of the causes of Claudio Piron

high and sticky inflation. If the de la Espriella administration presents a credible fiscal EmergingMerrill LynchAsia(Singapore)FI/FX Strategist

plan, we think BanRep will want to reward by not hiking rates anymore. claudio.piron@bofa.com

Pedro Diaz

Caribbean Economist

BofAS

pdiaz2@bofa.com

Chart 1: 12-month priced-in policy rate change vs BofA forecasts

Our forecasts are more dovish than market expectations GEMs FI Strategy & Economics BofAS

150 150 See Team Page for List of Analysts 118

100 80 72 66 100

56 51 41

50 28 50

20 19 12

0 0

-1 -6 -16 -50 -50

Hikes Cuts BofA

-100 -100

-150 -150