Brazil Monetary Policy


Central Bank leaves interest rates unchanged in January

At its 16 January meeting, the Central Bank's Monetary Policy Committee (COPOM, Comite de Politica Monetaria) decided to maintain the benchmark SELIC interest rate at a record-low of 7.25%, in a unanimous vote. The decision was broadly in line with market expectations.

An accompanying statement revealed that policymakers face something of a quandary. According to the short communique, although upside risks to inflation have increased recently, the recovery of domestic economic activity is still lethargic and uncertainty in the global economic environment persists. Nevertheless, the Bank confirmed that the stability of monetary conditions for a sufficiently long period of time is the most appropriate strategy to ensure the convergence of inflation to the target, suggesting that monetary authorities will remain on hold going forward. The minutes, including details of the meeting, will be released on 24 January.


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Brazil Monetary Policy Chart

Brazil Monetary Policy January 2013

Note: SELIC target rate (Taxa SELIC meta) in %.
Source: Central Bank of Brazil (Banco Central do Brasil).

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