Brazil’s Central Bank Pushes Selic Rate to 15 Percent
(MENAFN) On Wednesday, Brazil’s Central Bank raised its key Selic interest rate by 0.25 percentage points, bringing the annual rate to 15 percent. This marks the seventh straight increase since the tightening cycle began last August.
The Monetary Policy Committee (Copom) noted in their announcement that this might be the last rate hike for now, as they plan to pause and evaluate the effects of the current monetary restrictions.
"The committee anticipates a pause in the interest rate hiking cycle to evaluate the accumulated effects of the monetary adjustment and determine whether maintaining the current rate for a sufficiently long period will ensure inflation converges toward the target," the statement confirmed.
All Central Bank board members supported the decision, which has pushed the Selic rate to its highest point since July 2006.
Copom highlighted ongoing vigilance over how fiscal policy shifts impact monetary policy and the financial markets. The committee pointed out that the economic climate still faces challenges, including unstable inflation expectations, persistently high inflation forecasts, strong economic activity, and pressures on the labor market.
According to the most recent Focus survey, inflation is predicted to hit 5.25 percent in 2025 and 4.50 percent in 2026. Both figures exceed the official inflation target of 3 percent, which includes a tolerance range of 1.5 percentage points.
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