Brazil’s central bank on Wednesday held interest rates at an all-time low less than a week after the victory of far-right lawmaker Jair Bolsonaro in presidential elections allayed fears of a currency sell-off.
The Brazilian central bank on Wednesday held interest rates at an all-time low despite a currency selloff, as widely anticipated, but said it could “gradually” raise them in the future if inflation expectations spike.
United States Federal Reserve officials discussed raising interest rates soon to counter excessive economic strength but also examined how global trade disputes could batter businesses and households, minutes of the U.S. central bank’s last policy meeting showed.
The US Federal Reserve hinted that a surprisingly strong jobs market recovery could lead it to raise interest rates earlier than it had been anticipating. At the same time, most Fed officials wanted further evidence before changing their view on when rates should rise, according to the minutes from the central bank's July 29-30 meeting.
The US Federal Reserve has said it plans to keep interest rates at close to zero at least until the US unemployment rate falls below 6.5%. The Fed previously had a date-driven target, rather than a data-driven one.
Chile and Peru opted this week against following the lead set by nations from Brazil to South Korea in cutting interest rates as economic growth and slowing inflation in the Pacific neighbors gave central bankers little reason to change monetary policy
Brazil lowered its benchmark interest rate to a near-historic low of 9% on Wednesday, as expected, but the central bank surprised with hints that more cuts may follow to revive Latin America's largest economy.
Brazil’s central bank will miss its inflation target this year for the first time since 2003 according to a central bank survey of economists. Consumer prices will rise 6.52% this year, according to the median forecast in a Sept. 23 central bank survey of about 100 analysts published Monday.
The European Central Bank (ECB) decided on Thursday to raise interest rates to 1.5% from 1.25% in an attempt to cool inflation in the 17-nation Euro zone. ECB president Jean-Claude Trichet said that inflation, now 2.7%, was likely to remain clearly above the ECB 2% target over the coming months.
Brazilian inflation slowed to its lowest level in eight months in May as fuel costs dropped. The sharp drop in the monthly inflation reading provided relief to policymakers who have battled surging prices this year with three interest rate hikes, public spending cuts and steps such as credit curbs to take steam out of the economy.