Chile Forum

Sorry - I'm really green..UF appears under precio in the portalinmobiliario.com listings, and is not the rent itself.
~Gina

It’s a monetary format to level out currency fluctuations, some feel Chile is mature enough and should get rid of it. I like it. The rate is 21.380,34 peso today 26 Oct 2010.

I recently had to look this up for a friend.

La Unidad de Fomento (UF)
Forma de Cálculo de la UF:

A continuación se muestra la fórmula de cálculo del factor de reajuste diario de la UF:

Rd=[ 1+vIPC -1 ] (1/d)
100


Donde:
Rd = Factor de reajuste diario del valor de la Unidad de Fomento.
d = Nº de días comprendidos en el período para el cual se calcula el valor diario de la UF.
vIPC-1 = Variación porcentual del IPC registrada en el mes inmediatamente anterior.

De esta manera, el valor de la UF para cada día se determinará sobre la base del valor del día anterior, según la siguiente fórmula:
UFdía = UFdía-1 x Rd

Its great, i quote everything in UF for work, takes the thinking out of adjusting for the factors i know nothing about!

as for the portalinmobiliario.com down the bottem you can change the sort order of the listings, and also the currency to $ (CLP), $US (USD), and UF( that seems to be default)

And most people know that if you wish to go back in history to see what the UF was worth in pesos in prior years, there are websites such as this one. Comes in handy when dealing with real estate valuations.

http://www.uf.cl/

UF is the real money of Chile. Companies pay in pesos to workers, but most important transactions in the country are made in UF.
Today, and UF is around US$40

Thx! - and thx forshowing how I can see the cost in $US.

Also the central bank has one of the better sites in Chile in English with the daily UF, euro and dollar rates posted along with a mountain of other economic stuff in English.
http://www.bcentral.cl/eng/

I use that site all the time to calculate our rates.

Honestly, I at first did not like the UF and thought it would confuse foreigners (it does), but over the last few years using it in our contracts (also keeps me from needing to revise contracts constantly) it has seriously helped stabilize our bottom line from all the ups and downs in the economy (does everyone recall the run in inflation we had a few years ago). It is especially nice for projects that can drag out over years.

I was really shocked a few weeks ago when a client contacted me to go ahead with a project I had previously issued a quote on some time ago, and I had to recalculate the invoice in to U.S. dollars that I had previously quoted about 6 months before using the same UF to pesos to dollar conversion system. Between the UF moving one direction and the dollar really moving the other, it was like a 30% increase in our prices in 6 months for people paying in U.S. dollars. Our prices have in fact stayed the same in UF for like the last three years.

I thought about lowering our prices to compensate, but it is a bunch of macro forces outside both my control and our client's control (a lot of it is just seasonal also). We work, live, and get paid in a peso environment, and my rising or falling cost track the UF fairly closely in pesos. Also on the flip side of that, a client that for example contracts us now in UF also gets the benefits down the road if everything moves the other direction. A couple years ago I was starting to question the use of the UF because the UF was going down, and the dollar was getting stronger. In a high inflation environment, UF is a serious stabilizer overall.

The worthless U.S. dollar however, not sure what to do about that. Suppose I could convert UF to Oz of Gold or silver if anyone wanted to pay that way.

Every time I am offered a consumer loan from my bank in Chile that has the interest calculated in Pesos, I am really tempted to take it because we get paid at UF rates in pesos.

Today an UF is worth exactly US$ 44.

I would definitely say there are two economies in Chile. One for the rich (UF economy), and one for the poor (pesos). Almost all workers making say under about million pesos a month, have their contracts quoted in pesos or are paid cash (the informal economy). I am sure some of the big companies quote their workers in UF, but like banks, insurance contracts, professional services and any general biz contract of any duration is quoted in UF. Also real estate or even cars. It is not that poor can not also use the UF, it is just they perhaps have less reason to or less education about its benefits. Just in the overall picture, those with money have more reason to care about say a 1-5% move in asset values as apposed to say my housekeeper.

I wonder what the U.S. economy would look like if suddenly all term contacts (imagine the small print on a U.S. credit card bill making sense) or housing prices were done in UF so everyone could transparently tell what the hell they were paying?