Across from Puerto Natales, on Seno Última Esperanza (“Last Hope Sound”), some of the mountainsides are still showing snow in early summer, but it’s been raining most of the day and the grass here is green – reminding me, on the most tedious day of the year, of Stan Freberg’s classic comedy spot "Green Chri$tma$." Recently everyone’s been talking about money in Argentina – most notably the end of the “currency clamp” – so let’s talk about Chile instead.
When I arrived in Natales late last February, the Chilean peso was at 618 per US dollar; a year earlier it had been at 558 per dollar. Today, though, with demand for Chilean copper slowing, the dollar is now worth nearly 700 pesos and prices are falling accordingly.
One obvious item is that, in a country with some of the continent’s most expensive gasoline – in past years, I’ve paid well over US$6 per gallon (US$1.58 per liter) in some locations – it’s now as low as US$3.70 per gallon (US$0.98 per liter). Contrast the photo above, from Puerto Puyuhuapi in February of 2014, with the one below, taken a few days ago in Punta Arenas.
With low inflation, and no need to change surreptitiously as has been the case in Argentina, Chile is definitely more affordable at present. One thing has changed for the worse, though. In the past, I’ve always recommended using the ATMs at BancoEstado, the state-run bank that had not imposed a charge on foreign currency transactions. When I arrived in Santiago last month, though, I was surprised to learn that their ATMs would now collect a 4000-peso (US$5.72 at present) fee for each withdrawal. That’s still lower than other Chilean banks, which charge up to 6000 pesos (US$8.58) per withdrawal.
In cases like this, it pays to withdraw relatively large amounts, so today I withdrew 200,000 pesos (US$285.95) at a branch here – that’s generally the largest allowed per transaction. Withdrawing smaller amounts with greater frequency is, obviously, far more costly.
That said, I did note what I hope may be a pleasant surprise. Chilean ATMs ask your approval before collecting the fee, giving you the option to cancel the transaction. Today’s did not, though, so perhaps they never reprogrammed the machines here and I got off cheap. I can only hope.