What’s at stake in Chile’s election?

The latest polls suggest that a right-wing candidate is likely to win Chile’s presidential election on 16th November, probably leading to more pro-business policymaking and a tighter fiscal stance than is currently the case. It’s not clear that this is fully priced into Chilean financial markets yet, which means there may be room for a temporary rally, particularly if right-wing parties sweep Congress. But irrespective of who wins, if we’re right that copper prices will fall from recent highs, that will limit the pace of growth over the next presidential term and weigh on the peso.