Brazil Central Bank Raises Benchmark Rate, Indicates Tightening to End

Paulo Trevisani – The Wall Street Journal, 7/29/2015

Brazil’s central bank raised its benchmark interest rate on Wednesday, but indicated it will be the last increase of the current, two-year, tightening cycle.

The bank raised the benchmark Selic rate to 14.25% from 13.75%, its 16th increase since April 2013. The decision was unanimous, though policy committee member Tony Volpon recused himself from the vote.

The bank said in an unusually explicit statement that leaving the Selic at its current level “for a sufficiently prolonged period is necessary for inflation to converge with the target at the end of 2016.”

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