translated from Spanish: Hacienda and lower interest rate: «It’s good news for Chile»

The Minister of Finance, Felipe Larraín, supported the unanimous decision of the Central Bank Council to reduce the interest rate to 2.5%, in the biggest low in ten years, since the subprime crisis affected our country. In the opinion of the Secretary of State, this measure «is good news for Chile», as it would help to encourage the development of the economy. «That certainly is a greater monetary stimulus than we had and we expect it to influence some interest rates, because they probably have less effect on the longer rates but yes on the shorter rates,» Larraín said in an interview with the 24-hour channel. «Let’s see how this expands into the system, because this is the shortest rate. You have to see how it beats consumer loans and mortgages. We are probably not going to have the same reductions in credit, but there are going to be effects on some credits, «he pointed out. On the benefits that people would have, the head of the tax wallet said that from now on there could be «more favorable credit conditions» for consumers. «We would expect to see a decrease in credit rates, consumer credit and some other appropriations, as for SMEs, in short. We will have some rates that are going to fall, probably not in all the magnitude of the 50 base points that lowers the monetary policy rate, but the effect of people basically comes through that, from the economic activity that this should contribute to Stimulate, «he complemented. In turn, the Secretary of State acknowledged that the Central bank’s decision could be due to the «complex economic situation» that both our country and the international market in general have experienced, although it was optimistic for the future. «I understand that expectations may have been generated here in Chile, because we were growing 4% last year and because we managed to recover the growth after many years of very low growth (…) But of course, that is not guaranteed and what we are doing from the government is not only to verify, to analyse, but that we are taking action so that the economic acceleration takes place in a significant way in the second quarter and particularly towards the second Semester, «he said.

Original source in Spanish

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