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
Banco Central do Brasil hikes the benchmark rate, as expected

Fingers crossed that rate cuts will spread more widely.