Brazil Plans to Aggressively Reduce Interest Rates

Economists say, however, currencies of emerging markets may come under pressure with Trump in the White House.

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Although still very dependent on inflation behavior and economic activity in the months ahead, Brazil’s Central Bank (CB) has indicated that it plans to continue to cut aggressively the country’s benchmark interest rates (SELIC). The CB’s Monetary Policy Committee (COPOM) surprised markets last week after deciding to unanimously reduce the SELIC by 0.75 percentage points.

“The decision to intensify [the reduction] was based on the evidence from the past few months that basically pointed out that we could sustain not only 0.50 percentage point [decrease . . .

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