Mexico, Colombia and Chile Rates: Banxico to BCCh — 2026-09-09
Chile’s central bank held its benchmark rate at 4.5% despite a double-forecast inflation surprise, while Mexico’s peso strengthened to near-yearly lows as inflation cooled and the fiscal package landed. In Colombia, the COLCAP index hit a record high on the back of a firming peso and slowing inflation, signaling renewed investor appetite for Latin American carry trades.
Mexico, Colombia and Chile Rates: Banxico to BCCh — 2026-09-09
Top developments
Chile holds rates at 4.5% amid inflation surprise and growth downgrades
On September 8, the Banco Central de Chile (BCCh) unanimously decided to maintain its Monetary Policy Rate (TPM) at 4.5%, extending a pause that began in December 2025. This decision coincided with the release of August inflation data showing an annual rate of 4.1%, double the market forecast and significantly above the central bank’s target range. The BCCh cited "greater than usual uncertainty" driven by Middle East tensions and local economic weakness as key factors for maintaining a cautious stance, while simultaneously halving its 2026 growth forecast to a range of 0.25-0.75%.
Mexican Peso strengthens on cooling inflation and fiscal clarity
The Mexican peso appreciated against the US dollar, trading near 16.89 USD/MXN on Wednesday, September 9, reaching levels close to yearly lows. This strength follows the release of August inflation data showing an annual rate of 3.26%, which, while accelerating slightly from July’s 3.1%, remains within Banxico’s tolerance band and supports the current restrictive policy stance. Investors are also reacting positively to the government’s submission of the 2027 Economic Package to Congress, which has reduced fiscal uncertainty in the short term.
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Colombia’s COLCAP hits record high as inflation slows and peso firms
Colombia’s stock market index, the COLCAP, closed at a record high of 2,565.37 on Monday, September 8, rising 0.82% as the Colombian peso strengthened to approximately 3,119 per dollar. The rally is supported by DANE data showing annual inflation slowed to 6.03% in July from 6.14% in June, easing pressure on Banco de la República (BanRep) to tighten further. This combination of moderating inflation and a stable currency is enhancing the appeal of Colombian assets for foreign investors seeking yield in the region.
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Local view
Local media in Chile highlighted the central bank's dilemma between supporting a weak economy and containing inflationary pressures from external shocks. ADN Radio noted that the unanimous decision reflects a strategy of "caution" amidst low local growth and geopolitical tensions. Meanwhile, El Economista in Mexico focused on the peso's resilience, describing it as "serene" ahead of the fiscal package delivery, with analysts watching closely for how the government’s 2026-2027 growth projections will impact bond yields. In Colombia, La República reported that while the BCCh cut its growth forecast, it maintained its inflation projection for 2026 at 3.7%, suggesting confidence that monetary policy is appropriately calibrated.
Context & numbers
- Chile Key Rate: Held at 4.5% since December 2025; traders expect no change until 2028.
- Chile Growth Forecast: Cut to 0.25-0.75% for 2026 from previous 1.0-1.75%.
- Mexico Inflation: August annual CPI at 3.26%; July was 3.1%.
- Mexico Peso: Trading near 16.89-16.92 USD/MXN, near yearly lows.
- Colombia Inflation: July annual CPI at 6.03%, down from 6.14% in June.
- Colombia COLCAP: Record close of 2,565.37 on September 8.
On the radar
- US Inflation Data: Markets are awaiting US CPI data, which could influence Fed rate expectations and spillover into Latin American currencies.
- Mexico Fiscal Package Details: Investors are scrutinizing the specific revenue and expenditure targets in the 2027 Economic Package delivered to Congress for implications on Mbono yields.
- BanRep Next Meeting: Attention shifts to upcoming Banco de la República communications for signals on whether the current 12% rate will be maintained or adjusted given the slight inflation slowdown.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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