Chile: Beneath a benign CPI print, persistence remains

Research evidence excerpt

J P M O R G A N

Latin America Economic Research

07 August 2026

Chile

Beneath a benign CPI print, persistence remains

Headline CPI increased by 0.1%m/m in July, below our forecast, driving

the annual print to 3.5%

Economic and Policy Research

Ex-volatile CPI increased 0.5%m/m, in line with our projection, with the

over-year-ago rate at 3.2%

(1-212) 834-4321

J.P. Morgan Securities LLC

Core services inflation momentum remains well above the pre-pandemic

norm, a sign of persistent inflation ahead

Juan Goldin

The underlying inflation data therefore continue to align with our call for

the Board’s next move to be a hike in 1Q27

Headline inflation printed slightly softer than we had expected in July, with the

forecast error basically explained by food prices printing below the projection. The

trailing 12 month rate thus declined to 3.53%, back within the upper bound of the

target range, while momentum dropped sharply. That said, underlying inflation,

captured by the central bank’s ex‑volatiles measure, continues to show momentum

edging higher, pointing to persistence. This is most visible in core services, the

most persistent component and the one most closely linked to domestic demand,

labor market conditions, and wages. A key factor behind this persistence, in our

view, is the growing disconnect between real wage dynamics and labor market

conditions: job creation has been subdued for months and the unemployment rate

continues to rise, yet real wage growth has regained momentum, and households

appear to have weathered the energy shock better than we previously assumed.

In the details, headline CPI increased 0.1% m/m in July, slightly below our forecast

and in line with consensus (BBG 0.1%, J.P. Morgan 0.16%). The 12‑month rate fell

to 3.53% oya from 4.34% in June, largely on base effects. On a seasonally adjusted

basis, headline inflation printed -0.12% m/m, well below the prior three‑month

average of 0.64%. The three‑month annualized pace dropped to 2.4%ar from

8.0%ar in the prior month, as the strong April print rolled out of the window.

The breakdown showed deflation in Transportation and in Insurance and Financial

…