Latam - BCCh and BCRP likely to keep rates unchanged

The Banco Central de Chile (BCCh) is expected to keep rates at 3.0% on 14 May. The April minutes show that the only policy option discussed was keeping rates on hold, which suggests a united board with a neutral bias. 

Activity has been weak but sentiment began to improve in April. President Bachelet's cabinet reshuffle could boost business confidence, allowing stronger growth in H2-2015. 

Banco de la Reserva de Perú (BCRP) will also decide rates on 14 May. No changes is expected, but a continued easing bias. 

The weaker Peruvian nuevo sol (PEN) has pressured inflation, which is near the top of the target range. Peru's April 2016 presidential elections could begin to have a negative impact on business confidence in H2-2015. BCRP may be saving its bullets for cuts later this year or early next year.