Copom begins meeting to define basic interest rate.
The median expectation (which disregards extremes in projections) from financial institutions is that the Selic rate will be raised again by 0,5 percentage points, as occurred in the previous meeting in May. Currently, the rate is at 8% per year.
Kelly Oliveira
Reporter from Agência Brasil
Brasilia – The Monetary Policy Committee (Copom) of the Central Bank (BC) is holding its fifth meeting of the year today (9) and tomorrow to define the basic interest rate, the Selic. The median of expectations (which disregards the extremes in the projections) of financial institutions is that the Selic will be raised again by 0,5 percentage points, as occurred in the previous meeting, in May.
In April, the Copom (Monetary Policy Committee) raised the benchmark interest rate by 0,25 percentage points. Currently, the Selic rate is at 8% per year.
The Central Bank raised the benchmark interest rate again this year due to rising inflation. When prices are high, the Monetary Policy Committee (Copom) increases the Selic rate to curb demand for goods and services and encourage savings. This tends to lower inflation. Even so, inflation as measured by the Broad Consumer Price Index (IPCA) is expected to remain above the target center (4,5%), but within the upper limit (6,5%).
According to financial market expectations, the IPCA (Brazilian consumer price index) should close this year at 5,81%. The Central Bank's forecast is 6%. In the 12 months ending in June, the IPCA reached 6,7%.
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