Brazil central bank to keep rates unchanged for some time - BBVA

FXStreet (Córdoba) - According to Enestor Dos Santos, economist from BBVA Research the latest inflation report from the Brazil Central Bank suggests that it will keep the main interest rate (Selic) unchanged at 14.25% for some time.

Key Quotes:

“The 3Q15 Inflation Report revealed that the BCB revised up its inflation forecasts for 2015 and 2016, mainly due to the exchange rate depreciation and a less supportive fiscal policy, and in spite of a more negative view on both external and domestic growth. However, the report suggested that the BCB will likely keep the Selic rate at 14.25% for some time.”

“The BCB revealed to be more confident on the impact of the previous monetary tightening to keep under control the second-round effects of the current corrections in exchange rate and in administered-prices.”

“We expect the Selic to remain unchanged for some time, with upside risks weighing in the next few months and downside pressures gaining momentum next year.”