The Monetary Tightening Continues
In the minutes of the last COPOM meeting, the Central Bank once again signaled that the cycle of raising the SELIC rate would continue. Although acknowledging the weakening of the labor market and deceleration of economic activity, concern over the strong inflation in recent months prompted the authorities to affirm the need for "determination and perseverance to impede its transmission over longer periods." In other words, despite the deepening recession, additional hikes in the SELIC rate are in store.
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