Central Bank of Brazil

September 23, 2021

Late Wednesday came the additional news from the Central Bank of Brazil of another full percentage point increase in the Selic interest rate to 6.25% along with a statement that another 100 basis point rate hike is probable at the committee’s next review. “At the present stage of the tightening cycle, this pace is the most appropriate to guarantee inflation convergence to the target at the relevant horizon and, simultaneously, allow the Committee to obtain more information regarding the state of the economy and the persistence of shocks. At this moment, the Copom’s baseline scenario and balance of risks indicate as appropriate to advance the process of monetary tightening further into the restrictive territory.” Today’s move was the fifth one of the sequence that began from a record low Selic rate level of 2.0% in March.

Copyright 2021, Larry Greenberg. All rights reserved. No secondary distribution without express permission.


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