Economics
Brazil Puts 14% Rate in Sight After Locking in More Tightening
- Policy makers lift rate by half a percentage point as expected
- They anticipate another hike of 50 points or smaller in August
A shopper buys produce at an outdoor market in the Tijuca neighborhood of Rio de Janeiro, Brazil.
Photographer: Maria Magdalena Arrellaga/BloombergThis article is for subscribers only.
Brazil raised its key interest rate by half a percentage point and signaled another hike in August, leaving the end to its aggressive monetary tightening campaign in the balance as 2023 inflation forecasts surge above target.
The central bank lifted the Selic to 13.25% on Wednesday, extending a cycle that’s boosted rates 11.25 percentage points since March 2021. In a statement, policy makers wrote it’s appropriate to tighten policy “significantly into even more restrictive territory” given the unfavorable consumer price outlook.