Last night, The Central Bank of Brazil kept its benchmark rate steady at 8.75%, against market expectations. It was not an unanimous decision, as five members voted for keeping rates flat while the other three voted for increasing rates by 50 bps.
Some argue that tightening now would have been the best choice as the economy might be growing above sustainable levels and inflation expectations have been climbing constantly for the past weeks. After being flat since 2008, inflation expectations reached 5.03% for 2010 and 4.60% for 2011. The malicious question would be if this decision has any political hidden agenda. In an election year, economic growth is certainly welcomed, whether it is healthy or not in the long term.
Our latest survey
Get a specialist on Brazil
Give us your opinion
- Turning Brazil into an agricultural powerhouse
- Brazilian presidential elections pressing question: what candidate will the “big-center”parties support?
- Boeing and Embraer confirm talks for a potential merger
- How young Brazilians hope to clean up politics
- Is Bolsonaro going to be President?
- Brazilian currency boosted by lower inflation in the U.S.
- Enemies wanted : The Brazilian army is turning into a de facto police force Its plodding infantry are ill-suited to repel threats to natural resources
Albanian Arabic Bulgarian Catalan Chinese Simplified Chinese Traditional Croatian Czech Danish Dutch Estonian Filipino Finnish French Galician German Greek Hebrew Hindi Hungarian Indonesian Italian Japanese Korean Lativian Lithuanian Maltese Norwegian Polish Portuguese Romanian Russian Serbian Slovak Slovenian Spanish Swedish Thai Turkish Ukrainian Vietnamese
- Sub ratione Dei