Brazil’s central bank, Banco Central do Brasil, has cut its benchmark rate, Selic target rate, by 50 basis points.
The consensus was for a 25bp cut. The Bank says that 25 was considered but the improvement in inflation dynamics was enough for a 50 point move:
- the current situation demands serenity and moderation in the conduct of
monetary policy -
if expected scenario
is confirmed, the committee unanimously expects a rate cut of same
magnitude in coming meetings - the total magnitude of
easing cycle will depend on the inflationary dynamics, inflation
expectations, inflation projections, output gap and the balance of
risks
Fingers crossed that rate cuts will spread more widely.