Brazil Central Bank on Verge of Turning Point as Inflation Eases
- Inflation expectations are closer to central bank’s target
- Cut signals start of recovery from Brazil’s deepest recession
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For six years, Brazil’s central bank failed to achieve its mandate of ensuring price stability, damaging its credibility and eroding Brazilians’ purchasing power. Even as the nation’s economy nose-dived into the worst recession on record, policy makers had little choice but to stick with one of the highest interest rates among G-20 nations.
But now, with central-bank inflation projections finally on target, a highly experienced economic team in place and a government committed to fiscal discipline, Brazil is on the verge of monetary easing for the first time since 2012.