BLOOMBERG.COM
Brazil’s inflation projections allow for gradual and moderate interest rate cuts but indicate a limit to the extent of the easing cycle, the country’s central bank said on Tuesday. Fiscal adjustments have made more progress than expected in Congress but continue to represent a risk, according to the minutes of the central bank published on its website. The bank’s board said that inflation projections in 2017 and 2018 allow for a “gradual and moderate” easing of monetary policy. Policy makers led by president Ilan Goldfajn also wrote in the minutes to their Oct. 18-19 meeting that “projections in the market scenario suggest limits to the magnitude of the flexibilization in the same horizon.” Interest-rate futures rose as traders continued to unwind bets on more aggressive rate cuts. Swap rates on the contract maturing in January 2018 rose 6 basis points to 12.22 percent in early trading.
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Brazil’s inflation projections allow for gradual and moderate interest rate cuts but indicate a limit to the extent of the easing cycle, the country’s central bank said on Tuesday. Fiscal adjustments have made more progress than expected in Congress but continue to represent a risk, according to the minutes of the central bank published on its website. The bank’s board said that inflation projections in 2017 and 2018 allow for a “gradual and moderate” easing of monetary policy. Policy makers led by president Ilan Goldfajn also wrote in the minutes to their Oct. 18-19 meeting that “projections in the market scenario suggest limits to the magnitude of the flexibilization in the same horizon.” Interest-rate futures rose as traders continued to unwind bets on more aggressive rate cuts. Swap rates on the contract maturing in January 2018 rose 6 basis points to 12.22 percent in early trading.
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