“So we are cutting (missions) in half, which reflects the fact that we will have a significantly stronger overall balance than people thought we would have,” said Marcel, adding that most of these missions will be used. refinance missions arriving chance.
The Minister is confident that Chile will soon put an end to inflation, which is in the double digits.
“We are particularly confident in terms of reducing inflation sooner than other countries,” he said, citing an early and consistent tightening of monetary policy that began in mid-July 2021.
RETIREMENT AND PESO
The Chilean peso came under pressure like many other currencies from the strength of the dollar, breaking the 1,000 peso per dollar mark for the first time last July.
It is currently at 944 pesos per greenback, down nearly 10% since the start of the year.
Marcel said between 100 and 150 pesos in the exchange is due to an uncertainty premium which he says soared at the end of 2019 when Chileans took to the streets in what have been the biggest social protests for decades.
The COVID-19 pandemic and a series of votes in Chile, including a referendum that rejected a new constitution that would have greatly expanded social benefits, have helped keep uncertainty high.
Marcel said clear signals for another moderate constitutional proposal, progress on tax reforms and hopeful pension reforms will help reduce uncertainty.
The pension reform should be presented to Congress in a few weeks, aiming among other things to extend the basic benefit by some 30% and increase employers’ contributions by 6%.
“Pension reform should cost something between 4 and 5% of (gross domestic product) in the long run,” Marcel said.
“It would take at least six years to cope with all this increase in order not to have an impact on employment.”