Central Bank of Brazil

September 4, 2014

The Brazilian Selic interest rate has been kept at 7.25%, its level since April and 375 basis points above the level prior to April 2013.  Moreover, the released statement, unlike July’s, did not suggest that this peak would necessariy be retained more then for “the moment.”  Officials must balance the realities of elevated inflation at 6.5% versus a target of 4.5% and sub-1% growth.  Added uncertainty stems from presidential elections next month and the likelihood suggested by polls of a change of political leadership afterward.  It’s not a time to rock the boat.

Copyright 2014, Larry Greenberg.  All rights reserved.  No secondary distrib ution without express permission.



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