Brazil’s Central Bank Raises Interest Rates by 100 Basis Points and Signals Smaller Hikes Ahead
Brazil’s central bank has raised interest rates by 100 basis points for the third time, raising the Selic rate to 14.25%. The bank anticipates smaller future hikes while monitoring economic conditions.
On Wednesday, Brazil’s central bank raised interest rates by 100 basis points for the third consecutive time. This decision was consistent with prior guidance and reflects the bank’s ongoing assessment of economic indicators suggesting a slowdown. The bank’s rate-setting committee, known as Copom, increased the Selic rate to 14.25%, a figure not witnessed since 2016. This unanimous decision aligned with the forecasts of the 37 economists surveyed by Reuters.
In summary, Brazil’s central bank continues to adjust its monetary policy in response to economic conditions, elevating the Selic rate to 14.25%. While maintaining an aggressive approach to interest rate increases, the central bank has indicated the likelihood of smaller hikes going forward as it evaluates the economic landscape.
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