Brazil Anticipates Keeping Key Rate at Near Low Over 18 Months

Brazil anticipates keeping its benchmark borrowing cost near a record low for the next 18 months, a government official said, challenging higher market interest rates based on above-target inflation in 2013.

Policy makers said yesterday that inflation will slow to around their 4.5 percent target in 2012, giving the central bank room to reduce the Selic rate to “slightly above” the historical low of 8.75 percent.