ePaper

Saturday, May 26, 2018

Brazil forecast to cut interest rate to new low of 6.25%

  • Print

Brazil's Central Bank was forecast to drop its interest rate Wednesday to a historic 6.25 percent low, as President Michel Temer declared victory in his bid to end a brutal recession. A new 25 basis points cut in the key Selic rate from 6.5 percent would follow up on the Central Bank's sustained campaign to stimulate a still tepid recovery from Brazil's worst recession on record.

Back in October 2016, when the bank was fending off high inflation, the rate had climbed all the way to 14.25 percent. However, analysts predicted that a cut on Wednesday would be the last in the cycle of 13 consecutive lower rates as the bank looks to potential new inflationary threats.

Temer used the second anniversary of his government -- which took power after the still controversial impeachment of Dilma Rousseff -- to declare that Brazil was in good economic health again. "We are responsible and proud for having taking the country out of its worst recession in history," he said Tuesday.

Temer, who has single-digit approval ratings, admitted that his market-orientated reforms and austerity measures had "cost us our popularity," but insisted that he'd done the right thing. "The results are there, the numbers are good. We did in two years what the others didn't do for 20," he said. Uncertain times lie ahead, however.

Analysts say the Central Bank is eyeing inflationary pressure from possible rate hikes in the United States, the increase in oil prices and devaluation of the national currency, the real. On Tuesday, the dollar traded at 3.66 real, a two year high. The real has lost 10 percent of its value against the dollar since January.

-AFP, Brasilia

More News For this Category

US bill would force cos to disclose software probes

| By
US tech companies would be forced to disclose if they allowed American adversaries, like Russia and China, to examine the inner workings of software sold to the U.S.
US bill would force cos to  disclose software probes

Oil prices fall as OPEC and Russia weigh output boost

| By
Oil prices fell on Friday as OPEC and Russia considered easing supply curbs to offset disruptions in Venezuela and an expected drop in Iranian exports.Russian Energy
Oil prices fall as OPEC and Russia weigh output boost

Iran's first female manufacturer, a victim of Trump

| By
She fought through a male-dominated world to become perhaps Iran's first female manufacturing boss, and was on the cusp of major success with the help of a European
Iran's first female manufacturer, a victim of Trump

Philippines to cut 14pc poverty rate by 2022: ADB

| By Business Desk
The Asian Development Bank (ADB) has expressed optimism that the Philippines will meet its target to cut poverty rate by 14 percent by 2022, the government said on
Philippines to cut 14pc poverty rate by 2022: ADB

US natural gas poised for global rise

| By
The United States produces natural gas in abundance and is poised to become the world's third-largest exporter by 2020, a production ramp-up supported by President Donald Trump.
US natural gas poised for global rise

US Commerce's Ross to visit China in June

| By
US Commerce Secretary Wilbur Ross will visit China early next month for another round of talks amid ongoing trade frictions between the world's two largest economies.Ross

Global stocks fall

| By
Global stocks slid on Thursday, with persistent global trade worries compounded when Washington suddenly canceled a nuclear summit with North Korea. Wall Street started the day

Asian stocks fall as Trump ditches Kim summit

| By
Asian markets mostly fell on Friday as Donald Trump shocked the world by pulling out of next month's historic summit with Kim Jong Un, though analysts said the

Trump to raise new doubts on US-China trade deal

| By
President Donald Trump cast doubt Wednesday on the prospects for talks that are designed to head off a trade war between the United States and China. Four days
Trump to raise new doubts on US-China trade deal

Asian investors cautious as tariff threat hit autos

| By
Asian markets were mixed Thursday with traders concerned about the China-US trade deal and Donald Trump's summit with Kim Jong Un, while automakers were hit by news Washington
Asian investors cautious  as tariff threat hit autos

© 2018 The Asian Age