Brazil economists cut their 2014 key interest rate forecast for the second straight week, as 350 basis points in borrowing cost increases since last year threaten to undermine growth.
Brazil’s central bank will lift the benchmark Selic to 11 percent this year, compared with analysts’ estimates of 11.13 percent last week and 11.25 percent two weeks ago, according to the March 7 central bank survey of about 100 economists published today.
President Dilma Rousseff’s administration is combating prospects of faster inflation and slower growth. While the economy expanded more than analysts’ estimates in the fourth quarter, both consumer and industrial confidence remain low.
The central bank on Feb. 26 halved the pace of key rate increases as factors including a weaker real pressure consumer prices even as demand remains uneven. Economists in this week’s central bank survey cut their 2014 growth projections to 1.68 percent.
That’s down from 1.70 percent last week and 1.90 percent a month ago. Brazil’s gross domestic product gained 2.3 percent in 2013. That compares with 1 percent growth in 2012 and 2.7 percent expansion in 2011.
Brazil’s central bank board considers “appropriate the continuation of the adjustments of monetary conditions under way,” according to the minutes to its Feb. 25-26 meeting released on March 6. Officials also reiterated that monetary policy has a delayed effect on inflation.
Turkey, Russia
Central bankers on Feb. 26 raised the benchmark Selic by 25 basis points to 10.75 percent after six straight half-point boosts. Policy makers have lifted borrowing costs along with other countries such as Turkey and Russia to fight price pressures.
Monthly inflation in February will accelerate, as annual price increases rise to 5.64 percent from 5.59 percent in January, according to the median estimate from 31 economists surveyed by Bloomberg.
Brazil’s twelve-month inflation has remained above the central bank’s 4.5 percent target for more than three years. The national statistics agency will publish the official inflation figure on March 12.
Latin America’s largest economy expanded 0.7 percent in the fourth quarter from the prior three months after contracting 0.5 percent in the third quarter, the national statistics agency said on Feb. 27.
The median estimate of economists surveyed by Bloomberg was for 0.3 percent growth. Even as growth picked up, confidence levels have not rebounded.
Industrial sector sentiment in February fell to the lowest level since July, while consumer confidence plunged to the lowest since May 2009.
bloomberg.com
Brazil’s central bank will lift the benchmark Selic to 11 percent this year, compared with analysts’ estimates of 11.13 percent last week and 11.25 percent two weeks ago, according to the March 7 central bank survey of about 100 economists published today.
President Dilma Rousseff’s administration is combating prospects of faster inflation and slower growth. While the economy expanded more than analysts’ estimates in the fourth quarter, both consumer and industrial confidence remain low.
The central bank on Feb. 26 halved the pace of key rate increases as factors including a weaker real pressure consumer prices even as demand remains uneven. Economists in this week’s central bank survey cut their 2014 growth projections to 1.68 percent.
That’s down from 1.70 percent last week and 1.90 percent a month ago. Brazil’s gross domestic product gained 2.3 percent in 2013. That compares with 1 percent growth in 2012 and 2.7 percent expansion in 2011.
Brazil’s central bank board considers “appropriate the continuation of the adjustments of monetary conditions under way,” according to the minutes to its Feb. 25-26 meeting released on March 6. Officials also reiterated that monetary policy has a delayed effect on inflation.
Turkey, Russia
Central bankers on Feb. 26 raised the benchmark Selic by 25 basis points to 10.75 percent after six straight half-point boosts. Policy makers have lifted borrowing costs along with other countries such as Turkey and Russia to fight price pressures.
Monthly inflation in February will accelerate, as annual price increases rise to 5.64 percent from 5.59 percent in January, according to the median estimate from 31 economists surveyed by Bloomberg.
Brazil’s twelve-month inflation has remained above the central bank’s 4.5 percent target for more than three years. The national statistics agency will publish the official inflation figure on March 12.
Latin America’s largest economy expanded 0.7 percent in the fourth quarter from the prior three months after contracting 0.5 percent in the third quarter, the national statistics agency said on Feb. 27.
The median estimate of economists surveyed by Bloomberg was for 0.3 percent growth. Even as growth picked up, confidence levels have not rebounded.
Industrial sector sentiment in February fell to the lowest level since July, while consumer confidence plunged to the lowest since May 2009.
bloomberg.com
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