Brazil Has No Timeline to Cut Rates, Central Bank Chief Says

Brazil’s central bank chief Ilan Goldfajn said on Tuesday that there is no timeline for easing monetary policy. Interest-rate swap rates rose in the futures market.

“Any decision will be taken at the Copom meeting, based on the evolution of combined factors and on the outlook for inflation,” Goldfajn said during a Senate hearing in Brasilia, referring to the meetings of the bank’s monetary policy committee. “In sum, easing monetary conditions will depend on factors that give committee members confidence that the inflation target will be met.”

Yields paid on the interest-rate contract maturing in January 2017 rose as many as 3 basis points following Goldfajn’s remarks. Investors have recently increased bets that policy makers will reduce the benchmark rate this month for the first time since 2012 as consumer prices rose less than estimated in mid-September and a central bank quarterly report forecast inflation on target next year.

Goldfajn, who took the reins of the central bank in June, has already presided over two rate meetings. He twice held benchmark borrowing costs at 14.25 percent, while changing the institution’s communications strategy by publishing longer communiques with a deeper analysis on inflation.

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