Brazil Monetary Policy January 2016


Brazil: Central Bank leaves SELIC unchanged amid high inflationary pressures

January 20, 2016

At its 20 January meeting, the Central Bank’s Monetary Policy Committee (COPOM, Comite de Politica Monetaria) decided to leave the benchmark SELIC interest rate unchanged at 14.25%. The move marked the fourth meeting at which the Bank has held interest rates after seven consecutive rate hikes. Market analysts were split on whether the Central Bank would hike or hold rates. The SELIC interest rate remains at a nine-year high amid high inflationary pressures and economic recession in Brazil.

In the brief accompanying statement, the Central Bank outlined that the move is consistent with its assessment of the current balance of risks and uncertainties. However, similar to the last meeting, the decision to hold the SELIC interest rate stable was not unanimous. Six members of the committee voted to keep the SELIC interest rate unchanged, while two members voted to raise the rate by 50 basis points.

Moreover, the Bank’s decision comes against a worsening inflation outlook in Latin America’s largest economy. Despite the number of rate hikes and the economy being stuck in recession, inflationary pressures remain elevated and inflation ended 2015 at the highest level since 2002.

Participants in the LatinFocus Consensus Forecast see the SELIC rate ending 2016 at an average of 14.70%. Panelists see the SELIC rate ending 2017 at an average of 12.46%.

Author: Angela Bouzanis, Senior Economist

Sample Report

Looking for forecasts related to Monetary Policy in Brazil? Download a sample report now.


Brazil Monetary Policy Chart

Brazil Monetary Policy January 2016

Note: SELIC target rate (Taxa SELIC meta) in %.
Source: Central Bank of Brazil (Banco Central do Brasil).

Brazil Economic News

  • Brazil: Economic activity steady in December

    February 15, 2019

    In December, economic activity increased 0.2% in seasonally-adjusted month-on-month terms, according to the Central Bank’s monthly indicator for economic activity (IBC-Br, Indice de Atividade Economica do Banco Central).

    Read more

  • Brazil: Retail sales record worst result in nearly two years in December

    February 13, 2019

    Retail sales (excluding cars and construction) fell 2.2% from the previous month in seasonally-adjusted terms in December, notably contrasting November’s revised 3.1% expansion (previously reported: +2.9% month-on-month) and the largest drop since January 2016. Declines were recorded in five of the eight categories of the index, with notably contractions in sales of other articles for personal and domestic use, and furniture and household appliances. On an annual basis, retail sales rose 0.6% in December, notably below November’s 4.5% expansion.

    Read more

  • Brazil: Inflation inches up in January

    February 8, 2019

    Consumer prices rose 0.32% in January over the previous month, accelerating from December’s 0.15% increase.

    Read more

  • Brazil: Central Bank holds SELIC rate at record-low

    February 6, 2019

    At its 5–6 February meeting, the Central Bank of Brazil’s Monetary Policy Committee (Comité de Política Monetária, COPOM) unanimously decided to keep the benchmark SELIC interest rate at its record low of 6.50%, where it has rested since the Central Bank paused its long and aggressive easing cycle in March.

    Read more

  • Brazil: Manufacturing PMI edges up in January

    February 4, 2019

    Conditions in Brazil’s manufacturing sector improved at the start of 2019.

    Read more

More news

Search form