Central Bank cuts interest to all-time low 5% a year

For the third time in a row, the Brazilian Central Bank lowered the country’s benchmark interest rate. The Monetary Policy Committee (Copom) reduced the Selic rate to five percent a year, down 0.5 percentage points. The decision had been expected by analysts.

The move, unveiled Wednesday (Oct 30), brings the rate to its lowest level since the beginning of the current time series, in 1986.

In a statement, the Central Bank reiterated the need not to interrupt the country’s economic reforms so that interest stays low for long. The text indicates that a new 0.5 percentage point reduction is likely to take place by the year’s end.

“The committee believes that the consolidation of a benign scenario for the prospective inflation will allow an additional adjustment of equal magnitude,” the note reads.

The next Copom meeting is slated for December 10 and 11.