The Central Bank of Brazil said on Wednesday that it had cut its interest rate by 0.5 percentage points to 13.25% for the first time in three years as the country's inflation forecasts improved
MOSCOW (Pakistan Point News / Sputnik - 03rd August, 2023) The Central Bank of Brazil said on Wednesday that it had cut its interest rate by 0.5 percentage points to 13.25% for the first time in three years as the country's inflation forecasts improved.
"Considering the assessed scenarios, the balance of risks, and the broad array of available information, Copom (Monetary Policy Committee) decided to reduce the Selic rate by 0.50 percentage point, to 13.25% p.a., and judges that this decision is consistent with the strategy for inflation convergence to a level around its target throughout the relevant horizon for monetary policy, which includes the year of 2024 and, to a lesser extent, 2025," the bank said in a statement.
The bank also expects the country's inflation rate to reach 4.9% in 2023, 3.4% in 2024 and 3% in 2025, the statement added.
The last time the Brazilian central bank lowered the key rate was during the COVID-19 pandemic in August 2020, with the rate reaching 2%. Later, the interest rate was raised 12 times and reached 13.75% in August 2022.
