Brazil Signals More Interest Rate Increases at a ‘Softer’ Pace

Brazil’s central bank signaled it may keep raising borrowing costs for a longer period of time than many economists had expected after slowing the pace of rate increases yesterday.

Policy makers raised the benchmark Selic rate by a quarter point to 12 percent, surprising the 41 of 58 analysts surveyed by Bloomberg who expected them to maintain the 50 basis point pace of the previous two meetings. Fifteen analysts predicted the smaller increase, which was anticipated by traders, according to interest-rate futures. Two dissenting members of the board favored raising the Selic to 12.25 percent.