Lates News

The Central Bank of Brazil has decided to raise the benchmark interest rate by 50 basis points to the highest level since 2006, as policymakers try to contain high inflation while also noting the worsening global economic outlook. The Central Bank of Brazil's decision to raise rates to 14.75% on Wednesday was in line with market expectations. After three consecutive 1 percentage point rate hikes, the Central Bank of Brazil slowed down the pace of rate hikes as expected. The Central Bank of Brazil has raised rates by a total of 4.25 percentage points since September last year because inflation is expected to remain above the target level of 3% until the end of 2028. Rising prices of services and food have intensified inflationary pressures, while a strong labor market has supported consumer demand. However, President Trump's tariff measures have cast a shadow over the global economic outlook, and the Central Bank of Brazil's survey shows that economists have lowered their interest rate forecasts for the end of 2025. Goldman Sachs' chief economist for Latin America, Alberto Ramos, said before the decision was announced, "The fight against inflation is far from over. It is necessary to tighten monetary policy further as inflation is expected to remain well above the target level."