Interest Rate in Brazil
Brazil - Interest Rate
COPOM meets expectations and delivers 12th consecutive hike in August
At its 2–3 August meeting, the Monetary Policy Committee (COPOM) of Brazil’s Central Bank (CBC) unanimously decided to raise the benchmark SELIC interest rate by another 50 basis points—as priced in by markets—bringing it to 13.75%. The move marked the 12th consecutive raise—a cumulative 1,175-basis-point increase since the tightening cycle began in March 2021.
The decision to continue tightening its stance was once again driven by the desire to rein in stubbornly high inflation. Moreover, the Bank noted that high-frequency indicators hinted that economic activity continued to strengthen throughout the second quarter, providing more room for the rate hike.
With regard to forward guidance, the Committee once again stated in its communiqué that inflationary risks remain in both directions; chiefly the increasing risk of a sharp global slowdown on the downside and the possibility that fiscal measures to stimulate demand become permanent on the upside. As such, it reiterated that “given its projections and the risk of de-anchoring expectations for longer terms, it is appropriate that the monetary tightening cycle continues to advance significantly in an even more contractionary territory”. The Committee affirmed that it will consider a “minor residual adjustment” at its next monetary policy meeting, scheduled for 20–21 September.
Our panelists are currently assessing the Bank’s latest move.
Brazil - Interest Rate Data
|Policy Interest Rate (%)||14.25||13.75||7.00||6.50||4.50|
5 years of economic forecasts for more than 30 economic indicators.
Brazil Interest Rate Chart
Source: Central Bank of Brazil.
|Bond Yield||6.79||-0.82 %||Dec 31|
|Exchange Rate||4.02||-0.13 %||Jan 01|
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September 2, 2022
Industrial output increased 0.6% month-on-month in seasonally-adjusted terms in July (June: -0.3% mom).
August 25, 2022
The seasonally-adjusted consumer confidence index published by the Getulio Vargas Foundation (Fundação Getúlio Vargas) came in at 83.6 in August, up from July's 79.5.
August 15, 2022
Economic activity expanded 0.7% in month-on-month seasonally-adjusted terms in June, which contrasted May's 0.3% decrease.
August 10, 2022
Retail sales dropped 1.4% in month-on-month seasonally-adjusted terms in June, which was a larger contraction than May's 0.4% decrease.
August 9, 2022
Consumer prices fell a seasonally-adjusted 0.68% over the previous month in July, contrasting the 0.67% rise seen in June.