Chile’s inflation rate MoM for October 2025 registered a 0.40% increase, according to the latest data from the Sigmanomics database. This figure matches market expectations and marks a rebound from the 0.00% reading in September. Over the past year, the average monthly inflation rate has hovered around 0.25%, indicating that October’s print is a significant upward deviation.

Drivers this month

• Food prices rose by 0.55%, driven by supply chain disruptions and seasonal factors.
• Energy costs increased 0.60%, reflecting higher global oil prices and domestic fuel taxes.
• Shelter inflation remained steady at 0.20%, consistent with rental market trends.
• Used car prices declined slightly by 0.05%, providing a minor offset.

Policy pulse

The 0.40% MoM inflation rate remains above the Central Bank of Chile’s target band midpoint of 0.30%. This suggests ongoing inflationary pressures that may prompt further monetary tightening if sustained. The central bank’s recent pause in rate hikes is under review as inflation dynamics evolve.

Market lens

Immediate reaction: The Chilean peso (CLP) weakened 0.30% against the USD within the first hour post-release. Short-term government bond yields rose by 10 basis points, reflecting increased inflation risk premiums. Breakeven inflation rates for 2-year bonds climbed 15 basis points, signaling market expectations of persistent inflation.

Chile’s inflation rate is a critical macroeconomic indicator influencing monetary policy, wage negotiations, and fiscal planning. The 0.40% MoM increase in October 2025 contrasts with the zero growth in September and the 0.22% average monthly inflation recorded in the same month last year.

Monetary Policy & Financial Conditions

The Central Bank of Chile has maintained the policy rate at 11.25% since August 2025, following a series of hikes earlier in the year. The recent inflation uptick pressures the bank to reconsider its stance. Financial conditions remain tight, with credit growth slowing to 3.50% YoY and real interest rates slightly negative after adjusting for inflation.

Fiscal Policy & Government Budget

Chile’s fiscal deficit widened marginally to 2.80% of GDP in Q3 2025, partly due to increased social spending and subsidies aimed at cushioning inflation impacts on vulnerable populations. The government’s budget framework anticipates gradual deficit reduction but remains vulnerable to inflation-driven expenditure pressures.

External Shocks & Geopolitical Risks

Global commodity price volatility, especially in copper and oil, has amplified inflationary pressures. Geopolitical tensions in key trade partners have disrupted supply chains, contributing to cost-push inflation. These external shocks complicate Chile’s inflation outlook and policy calibration.

Drivers this month

• Food inflation contribution: 0.18 percentage points
• Energy inflation contribution: 0.15 percentage points
• Shelter contribution: 0.07 percentage points
• Used cars: -0.02 percentage points

Market lens

Immediate reaction: The CLP/USD exchange rate depreciated by 0.30%, while 2-year government bond yields rose 10 basis points. Inflation breakeven rates increased, reflecting market anticipation of sustained inflationary pressures.

Looking ahead, Chile’s inflation trajectory depends on multiple factors, including monetary policy responses, external commodity price trends, and domestic demand conditions. The following scenarios outline potential paths:

Bullish scenario (20% probability)

• Inflation moderates to 0.20% MoM by year-end due to easing global commodity prices.
• Central bank maintains current rates, supporting steady economic growth.
• Fiscal consolidation reduces inflationary fiscal pressures.

Base scenario (60% probability)

• Inflation remains around 0.35%-0.45% MoM in coming months.
• Gradual monetary tightening resumes in Q1 2026 to anchor inflation expectations.
• External shocks persist but are partially offset by domestic policy measures.

Bearish scenario (20% probability)

• Inflation accelerates above 0.50% MoM due to renewed supply shocks and wage pressures.
• Central bank forced into aggressive rate hikes, risking economic slowdown.
• Fiscal deficits widen, undermining confidence and peso stability.

Policy pulse

Monetary authorities face a delicate balance. The October print strengthens the case for cautious tightening but risks dampening growth if overdone. Fiscal discipline and targeted subsidies will be key to managing inflation without stifling recovery.

Chile’s October 2025 inflation rate of 0.40% MoM signals a renewed inflationary phase after a brief pause. The interplay of domestic cost pressures and external shocks complicates the macroeconomic outlook. Policymakers must navigate these challenges carefully to maintain price stability and support growth. Financial markets have priced in these risks, as seen in currency and bond yield movements. Structural inflation drivers, such as supply chain vulnerabilities and labor market tightness, remain relevant for the medium term.

Market lens

Investors should monitor inflation prints closely as they influence central bank decisions and asset valuations. The Chilean peso and short-term bonds are particularly sensitive to inflation surprises, offering trading opportunities amid volatility.

Key Markets Likely to React to Inflation Rate MoM

Chile’s inflation data typically impacts currency, bond, and equity markets. The following five tradable symbols have shown strong historical correlations with inflation movements, making them critical for traders and investors to watch.

• USDCOP – The USD/Colombian Peso pair often moves in tandem with regional inflation trends, reflecting commodity price shifts.
• ITUB3.SA – A major Brazilian bank stock sensitive to interest rate changes influenced by inflation.
• BTCUSD – Bitcoin’s role as an inflation hedge attracts attention during rising inflation periods.
• BSAC – Banco Santander Chile, directly impacted by Chilean macroeconomic conditions.
• CLPUSD – The Chilean Peso versus USD, highly sensitive to inflation and monetary policy shifts.

Extras: Inflation Rate MoM vs. CLPUSD Since 2020

Insight: Since 2020, monthly inflation spikes in Chile have closely preceded short-term depreciations in the CLPUSD exchange rate. For example, the 0.40% MoM inflation in October 2025 aligns with a 0.30% CLP weakening. This pattern underscores inflation’s direct influence on currency valuation, driven by expectations of monetary tightening and real purchasing power erosion.

Month	Inflation MoM (%)	CLPUSD Change (%)
Oct 2025	0.40	-0.30
Mar 2025	0.42	-0.28
Dec 2024	0.35	-0.25
Jul 2024	0.38	-0.22

FAQs

What is the current inflation rate MoM for Chile?

The latest inflation rate MoM for Chile is 0.40% as of October 2025, marking an increase from 0.00% in September.

How does the inflation rate affect Chile’s monetary policy?

Higher inflation rates increase pressure on the Central Bank of Chile to raise interest rates to maintain price stability.

What are the main drivers of inflation in Chile currently?

Food and energy prices are the primary contributors to the recent inflation rise, influenced by supply chain issues and global commodity prices.

Final takeaway: Chile’s October 2025 inflation rebound to 0.40% MoM signals persistent cost pressures and challenges for policymakers. Vigilant monitoring and balanced policy action will be essential to sustain economic stability.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.