Monetary, Exchange, and Financial Policies in Chile: Keys to a Stable Economy

Chile stands out for its solid economic structure, supported by well-defined monetary, exchange, and financial policies. Below, we explore how these policies contribute to the country's economic stability and growth.

Monetary Policy: Inflation Stability as a Goal

Chile maintains stable inflation expectations around 3%, aligned with its long-term target. This result is possible thanks to the role of the Central Bank of Chile, an independent entity that, through its constitutional mandate, is dedicated to preserving the stability of the currency by using inflation targeting policies.

The independence of the Central Bank ensures that decisions about interest rates and other monetary tools are not influenced by political pressures, guaranteeing controlled and predictable inflation. This stability is essential to maintaining investor confidence and promoting a favorable economic environment for businesses.

Exchange Rate Policy: Flexibility as an Adjustment Mechanism

Within the framework of exchange rate policies, Chile adopts a floating exchange rate regime. This policy allows the country to maintain an independent monetary policy orientation from larger financial markets. The flexibility of the exchange rate offers several key advantages:

  • Facilitates economic adjustment to real shocks: Allowing the exchange rate to fluctuate helps prevent significant misalignment in the face of adverse external situations.

  • Enables less traumatic and timely adjustments: In response to changes in the volatile international environment, the floating exchange rate provides a natural adjustment mechanism that cushions the negative impacts on the local economy.


Thanks to these characteristics, Chile can face global challenges with greater flexibility and adaptability, preserving its long-term economic stability.


Financial Policy: Strength and Transparency

The Chilean financial system is distinguished by its strong indicators and robust regulatory framework. Some key strengths include:

  • High levels of capitalization: With a capital level of 13.5% relative to risk-weighted assets, the Chilean financial system is well above the 8% minimum established by Basel, with no bank operating below 10%.

  • Healthy profitability: The financial system's profitability rate is around 15% on capital, reflecting the efficiency and strength of Chilean financial institutions.

  • Low levels of portfolio risk: With a portfolio risk below 2% and adequate provisions amounting to 120% of the past-due portfolio, the Chilean financial system demonstrates prudent credit risk management.

  • Well-regulated liquidity and market risks: Risks are kept within limits as a percentage of equity, generating a high level of confidence among depositors.


These factors reflect the stability and confidence in the Chilean financial system, making it a safe and attractive environment for both local and international investors.

With its monetary policy focused on stability, flexible exchange rate regime, and solid financial system, Chile provides a robust and reliable economic environment for businesses. These characteristics make Chile an attractive destination for foreign investment and a fertile ground for business growth.

At Gestoría, we understand the importance of a stable economic environment for the international expansion of companies. We offer comprehensive services to facilitate the entry and operation of your business in Chile, from company formation to legal representation and regulatory compliance.