COPOM Watch: Singular, at last

BRAZIL ECONOMICS - Report 21 Mar 2024 by Alexandre Schwartsman, Cristina Pinotti, Paula Magalhães and Diego Brandao

As expected, at its March meeting the Central Bank’s Monetary Policy Committee reduced the SELIC rate by 0.50%, from 11.75% to 10.75%. And although the communiqué that announced the meeting’s results was very similar to that disclosed in January, there was a fundamental change: while the previous text indicated the Bank’s intention to maintain the easing pace of 0.50% at the “next meetings”, the most recent one now mentions the “conditional commitment” (an deliberate oxymoron) to a cut of that size at the “next meeting” (singular), if the expected scenario comes to pass.

The truth is that in general, the communiqué reflects a slightly harder stance regarding the vision of the conjuncture and the conduction of monetary policy.

Now read on...

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