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Brazilian Central Bank expects inflation above the target

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Staff writer ▼ | April 1, 2016
Under the estimation that the inflation rate will go beyond the target this year, the Brazilian Central Bank (BC) said it’s not considering a reduction of the Selic, the benchmark interest rates.
Brazil street market
LatAm   The Brazilian bank will not touch rates
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The information is part of the BC’s Inflation Report, released every quarter and that calls for an inflation rate of 6.6% in 2016.

This is the first time that the BC estimates the inflation rate going above the target this year. The target center is 4.5% and the upper threshold is 6.5%.

According to the BC, the estimated probability of the inflation going over the upper threshold of the target is 55% in 2016 and 22% in 2017.

For the market, this probability is of 65% in 2016 and of 33% next year.

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