Brazil Central Bank maintains benchmark interest rate at 14.25% p.a.
Central Bank President Ilan Goldfajn during a COPOM meeting
For the ninth consecutive time, the Brazilian Central Bank refrained from changing the country's benchmark interest rate (SELIC). The Monetary Policy Committee (COPOM), a group of bank directors, decided unanimously to maintain the SELIC rate at 14.25% per annum. The rate have been at this level since the end of July last year.
The rate is named after the system in which it is used, the Special Clearance and Escrow System, and serves as a parameter for all other interest rates in the economy. It is also the Central Bank's main tool for curbing the official inflation, as measured by the National Broad Consumer Price Index (IPCA).
The rate, however, shows an 8.6% increase in the 12-month period ending in July, and now is above the target set by the National Monetary Council for this year: 4.5% with a 2-point margin.
In the Report on Inflation, released late in July by the Central Bank, the institution predicts that the IPCA should close out 2016 at 6.9%. The market, in turn, seems even more pessimistic. According to the Focus Market Readout, the weekly survey conducted by the bank on financial institutions, the IPCA should close out the year at 7.34%.
Translated by Fabrício Ferreira
Fonte: Brazil Central Bank maintains benchmark interest rate at 14.25% p.a.
