Brazil Economists Slash 2012 Rate Forecast for Second Week

Economists covering Brazil cut their year-end 2012 forecast for the benchmark rate for the second straight week on expectations of slower growth in the wake of Europe’s debt crisis.

Economists expect the Selic rate to fall to 9.50 percent by the end of 2012, according to the median forecast in a Dec. 9 central bank survey of about 100 economists published today, down from last week’s forecast of 9.75 percent. Analysts also cut forecasts for inflation next year, partly as economists incorporated new weightings for items that make up the IPCA index, disclosed by the national statistics agency in November.