Chile’s September inflation moderates to 0.4% as fuel costs and weak peso maintain upward pressure on consumer prices

Chile’s consumer price index increased 0.4% in September compared to August, below the 0.5% median forecast by analysts surveyed by Bloomberg, according to data released Thursday by the national statistics institute INE. Annual inflation held steady at 4.1%, maintaining its position above the central bank’s 3% target. The September reading brought accumulated inflation to 4.0% for the first nine months of 2026.

Food and transportation costs drove the monthly increase. Food and non-alcoholic beverages rose 0.6%, contributing 0.133 percentage points to the overall index, while transportation climbed 0.9% with an incidence of 0.122 points. Within food categories, vegetables and tubers jumped 4.1% and fruits increased 3.1%, with lettuce prices surging 10.5% and potatoes climbing 8.6% during the month.

Energy costs exerted significant pressure on the index. Diesel fuel prices spiked 10.2% in September and have accumulated a 36.8% increase in the first nine months of 2026. Gasoline rose 2.7% during the month, reaching a cumulative advance of 20.8% for the year. Overall energy costs climbed 1.9% in September, while electricity supply increased 1.6%. Insurance and financial services provided the only major offset, falling 5.9% during the month.

The Chilean peso remains near its weakest level in over a year, intensifying pressure on import costs as fuel prices continue rising at service stations. Central bank president Rosanna Costa and her board have maintained the benchmark interest rate at 4.5% throughout 2026, emphasizing that policy decisions will be taken on a meeting-by-meeting basis. The monetary authority forecasts annual inflation will decelerate to the 3% target by the second quarter of 2027, aided by weak demand and elevated unemployment that help contain price pressures.

Finance Minister Jorge Quiroz stated that inflation control remains the central bank’s responsibility and called for monetary measures to keep price increases in check. The Finance Ministry reduced its 2026 GDP growth forecast to 0.7% from 1.8% previously, while raising its 2027 estimate to 3.3% driven by anticipated investment increases. Traders surveyed by the monetary authority last month expect rates to remain unchanged for the next two years. Economy and Mining Minister Daniel Mas noted that inflationary pressures persist, attributing the September result to increased consumption during national holidays and external factors driving fuel costs higher.