The Central Bank of Chile’s December 15 policy decision is shaped by inflation holding above the 3% target at 4.1% year-over-year in September 2026, alongside a sharply downgraded 2026 GDP growth forecast of 0.25-0.75% and external pressures from the US-Iran conflict elevating fuel costs. The board has maintained the monetary policy rate at 4.5% through unanimous holds, including the most recent October meeting, while stressing a data-dependent, meeting-by-meeting approach and a neutral rate corridor centered near 4.25%. Market-implied odds favor no change at 58%, reflecting trader assessment of persistent but contained price pressures and weak domestic demand, though a 25 basis point hike carries 37.5% probability amid upside inflation risks and global monetary tightening signals. Upcoming October 27 minutes and November inflation data represent key near-term catalysts.