Chile stocks surge on rate cut, global rally

SANTIAGO, May 8 (Reuters) - Chile's leading share index surged over 2.5 percent on Friday, boosted by gains on global markets as a bigger-than-expected local central bank interest rate cut overnight propelled retail stocks, traders said.

The blue-chip IPSA share index .IPSA traded 2.6 percent firmer at 2,888 points.

Chile's central bank cut its target overnight lending rate by a larger-than-forecast 50 basis points after the market close on Thursday to a new record low of 1.25 percent. (Reporting by Manuel Farias)