Clipping of news on Brazilian Culture, Law and Citizenship
07/16/2014
This article was translated by an automatic translation system, and was therefore not reviewed by people.
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money
Monetary Policy Committee (Monetary Policy Committee) of the Central Bank (BC) announced today (16), after the close of the financial market, the decision on the benchmark interest rate, the Selic. This is the fifth year of the Monetary Policy Committee meeting.
The expectations of the financial market is maintaining the Selic at 11% per annum. The base rate has gone through a cycle of nine high straight, until April, when it was adjusted to the current level. In May, the Committee decided to halt monetary tightening.
When the Monetary Policy Committee increased the Selic, the goal is to contain the strong demand, which causes affects the prices, because higher interest rates become more expensive credit and stimulate savings. Already when the Monetary Policy Committee reduced the basic interest rate, the trend is that credit is getting cheaper, encouraging the production and consumption. To keep the Selic at the same level, signaling that the previous highs were sufficient to cause the expected effects on the economy. The central bank has reiterated that the effects of the high base rate accumulate and take time to appear.
The BC have to chase the inflation target set by the National Monetary Council. This target is 4.5%, with upper limit of 6.5%. The projection of the financial market indicates inflation, as measured by the National Consumer Price Index (IPCA), and close to this ceiling (6.48%).
Source: Brazil Agency
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This article was translated by an automatic translation system, and was therefore not reviewed by people.