On 20 October, the Central Bank Monetary Policy Committee (COPOM, Comite de Politica Monetaria) decided unanimously to leave the benchmark SELIC interest rate unchanged at 10.75% in a decision widely expected by market participants. The meeting minutes released on 28 October brought no surprises for market analysts, since the Central Bank is expected to maintain rates unchanged in the near future. The Committee also gave little attention to the rise in inflation forecasts during the last month, stating that recent price pressures are a result of temporary supply shocks affecting food prices, which were nonetheless already expected by monetary authorities and will be compensated for a disinflationary external scenario. In addition, the COPOM highlighted that its mid-term base-scenario includes a tighter fiscal policy stance and a deceleration in the pace of credit loans growth. That said, if these assumptions do not materialize, the Bank could quickly adopt measures, such as increasing reserve requirements for the Brazilian banks, to cool domestic credit growth. Against this backdrop, Consensus Forecast panellists expect the policy rate to end the year at 10.75% by end-2010. For next year, panellists expect the Central Bank to resume the tightening cycle in the second quarter and see the benchmark interest rate ending the year at an average rate of 11.66%.
Brazil Monetary Policy
Central Bank leaves rates unchanged
October 20, 2010
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Brazil Economic News
October 18, 2016
Retail sales (excluding cars and construction) fell 0.6% in August from the previous month in seasonally-adjusted terms.
October 7, 2016
Consumer prices in September increased 0.08% over the previous month, the lowest rise since July 2014.
October 4, 2016
In August, industrial production plunged 3.8% over the previous month in seasonally-adjusted terms, which significantly contrasted the 0.1% expansion recorded in July and marked the worst result since January 2012.
October 3, 2016
The Markit manufacturing Purchasing Managers’ Index (PMI) rose slightly in September, increasing from August’s 45.7 to 46.0.
September 28, 2016
Business sentiment improved in September, according to the Getulio Vargas Foundation’s (FGV, Fundaçao Getúlio Vargas) business confidence indicator.