• Categories
  • Archives

Brazil’s Central Bank Seems Intent on Keeping Lowering Interest Rates

Brazil’s Monetary Policy Committee (Copom), which is housed in the Central Bank and is Brazil’s equivalent of the US Federal Reserve and sets the country’s key interest rates says it will continue to act cautiously with its monetary policy.

The Copom points out that since September 2004 its decisions in that area now make it very probable that the 4.50% inflation target for the year will be achieved.

According to the minutes from last week’s Copom meeting (when it was decided to reduce the Selic by 0.75 percentage points to 16.25% per year), in spite of uncertainty with regard to petroleum prices, the members decided that "the inflation scenario is generally benign."

The minutes took note of the recent changes in the composition of gasoline in Brazil. Due to problems with the country’s supply of sugarcane-based ethanol, the government reduced the percentage of ethanol added to gasoline from 25% to 20%, incurring price variations that Copom said should even out over the course of the year. In fact, Copom maintained its forecast for a zero increase in fuel prices in 2006.

As for inflation, Copom’s forecast was unchanged: government-controlled prices (fuel, electricity, telephone, education, medicine, public transportation and others) should rise by 4.60% during the year.

That was actually more pessimistic than the latest market estimates (in the weekly Focus survey conducted by the Central Bank) which are for increases of 4.35% in 2006.

Agência Brasil


  • Show Comments (0)

Your email address will not be published. Required fields are marked *

comment *

  • name *

  • email *

  • website *

This site uses Akismet to reduce spam. Learn how your comment data is processed.


You May Also Like

A Candid Talk with Gerald Thomas, Brazil’s Brightest Prima-Donna

Trying to explain one’s art and motivation, while defending a particularly individualistic view of ...

Police Visit Brazilian Mall on Opening Day. 70% of Products Were Pirated

A new shopping mall catering to electronics buyers just opened last Friday, September 15, ...

Brazil: Journalist Wants Dictatorship Abuses Reinvestigated

Brazilian journalist Rose Nogueira, president of the group Tortura Nunca Mais (Torture Never Again). ...

Brazil to Harvest 450 Million Tons of Sugar Cane for Fuel, Sugar and Cachaça

Brazil’s sugar cane crop in the 2005/2006 growing year should reach 450.2 million tons, ...

Brazilians Treated to Arab Poetry and Music

The Institute of Arab Culture presents this Tuesday, June 7, at 8 o’clock in ...

Brazilian Congress Urges Speedy Creation of Palestinian State

Brazil's National Congress held a solemn session on Thursday, December 4, to observe the ...

Green Acres

Green Acres Despite the lack of infrastructure, Brazil has some of the world’s best ...

Brazilian President Ready for 5th African Tour

Brazilian President Luiz Inácio Lula da Silva will make an official visit to Algeria ...

Beatings, Censorship, Harassment: All in a Day’s Work for Brazilian Press

Reporters Without Borders voiced concern today, February 7, about an increase in legal proceedings ...

Brazilian Journalist Shot Three Times After Reporting on Drug Traffickers

International Press Freedom organization Reporters Without Borders (RSF) is voicing its concern about the ...