By Felipe Barragán, Expert Research Strategist at Pepperstone

 September 25, 2025 –

“The CLP spent the session negotiating between two big external forces: a firmer U.S. dollar and a copper tape that’s still being propped up by supply frictions. Powell’s cautious tone on further easing kept the dollar underpinned, and with Fed-cut bets being dialed back, the broad USD bid has resurfaced—an immediate headwind for high-beta FX like the peso. That setup has pushed the CLP above $950 as global USD demand picked up after Powell.

On the commodities side, copper’s near-term support is less about booming demand and more about disrupted supply. Freeport’s guidance shock—flagging weaker Q3 shipments after issues at Indonesia’s Grasberg—fed the notion of tighter concentrates and kept the red metal resilient, cushioning the CLP versus what the stronger dollar alone would have implied. Still, this is a fragile prop: it buys time for the peso when the USD is strong, but it doesn’t rewrite the demand narrative that ultimately anchors Chile’s terms of trade.

Domestic macro didn’t get in the way today. August producer prices rose 0.3%—with mining components again influential—consistent with a picture of sticky cost pressures but not a game-changer for the Central Bank’s near-term reaction function. With the policy rate held at 4.75% earlier this month and the September IPoM reinforcing a cautiously disinflationary baseline, the market still sees room for gradualism rather than a new tightening cycle. In practice, that means the CLP’s rate differential is unlikely to deliver a decisive buffer against a stronger dollar unless inflation were to re-accelerate meaningfully.

Put together, today’s mix reads like this: the global dollar impulse remains the primary driver, copper’s supply-tightness story offsets at the margin, and Chile’s policy stance stays in “steady hands” mode. Into the next few weeks, the balance of risks for CLP hinges on three things: whether Fed rhetoric finally breaks the dollar’s momentum; whether copper’s support shifts from supply noise to demand-led strength; and whether local prints nudge the Central Bank away from its gentle-easing bias.

If the USD softens on weaker U.S. data and copper holds its bid, the peso can grind firmer; if Powell stays cautious and global data wobble, the CLP remains a carry that trades heavy on risk-off days.”