Thursday 22 January 2009, San José, Costa
Rica
Central America to
Prioritize Migration
Issues with US
Nicaragua Reacts to
Support Anti-Crisis Plan
Ortega for
Austerity Measures to Face Crisis
Fidel Castro "Looks
Good," Says Argentine
President
Brazil Cuts Basic
Interest Rate To 12.75%
|
Brazil Cuts Basic
Interest Rate To 12.75%
Rio de Janeiro - Brazil
on Wednesday cut its
basic interest rate by
one percentage point to
12.75 percent to start
"a process of
flexibility to the
country's monetary
policy."
The Monetary Policy
Committee of Brazil's
Central Bank (Copom)
made the decision which
marks the sharpest cut
in the interest rate
since December 2003,
when it fell from 17.5
to 16.5 percent.
The cut was expected
amid increasing
unemployment figures,
but exceeded the
projection by analysts
of a 0.75-point
decrease.
The previous cut by
Copom was in December
2007. The interest rate
was raised to 13.75
percent last September,
and was maintained
during two meetings in
October and December.
Copom's decision was not
unanimous, the Central
Bank said, noting that
five members voted for
the one-point cut, while
the other three voted
for a 0.75-point cut.
The cut will not affect
the fulfillment of
Brazil's inflation
target, which was set at
4.5 percent, with a
tolerance of two
percentage points, the
Central Bank said.
Despite the cuts,
Brazil's real interest
rate (interest rate
minus inflation rate) is
still the highest in the
world.
The country's inflation
rate reached 5.9 percent
in 2008.
On Wednesday morning,
trade unions organized
protests in 12 state
capitals against the
high interest rates. The
largest protest was in
Sao Paulo, where more
than 1,000 workers
marched along several
main avenues of the city
demanding a rate cut.
In Brazil's capital of
Brasilia, about 100
workers protested in
front of the Central
Bank's headquarters
where Copom met.
The next meeting of
Copom is scheduled for
March 10-11. |
|
|
|
|
|
|
|
