Chilean Peso Loses Ground Ahead of Central Bank’s Rate Decision

  • USD/CLP gains 0.39% at the start of the American session.
  • Chile’s central bank will announce its interest rate decision at the end of trading today.
  • Investors will be keeping an eye on China’s Caixin PMI services data.

The USD/CLP marked a daily low at 915.50 finding aggressive buyers who have pushed the pair to a daily high at 919.44. At the time of writing, the US dollar is trading at 919.21 against the Chilean Peso, up 0.39% on the day.

The Central Bank of Chile prepares its next monetary policy move

Investors will be keeping an eye on today’s interest rate decision by the Central Bank of Chile. The consensus of analysts expects a 25 basis point cut to 5.50% from 5.75%.

On the other hand, Markit Economics will publish the Caixin PMI for Chinese services for August. Market expectations are for a slight increase to 52.1 from 5.1 recorded in July. An increase in this indicator would signal economic expansion and increase demand for copper, whose main producer in the world is Chile.

Technical levels in the USD/CLP

The USD/CLP reacted to the upside at a support located at 904.25, given by the low of August 27th that converges with the 23.6% Fibonacci retracement. The next key support is observed at 881.85, pivot point of May 20th. The closest resistance is at 941.25, high of August 16th, in confluence with the 50% Fibonacci retracement.

Chilean Peso Daily Chart

Source: Fx Street

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