Brazil cuts interest rate by 50 basis points

By Ovunc Kutlu

ISTANBUL (AA) - Brazil’s central bank lowered its benchmark interest rate by 50 basis points to 11.25%, its sixth consecutive rate cut.

"The global environment remains volatile, with debates about the beginning of the easing cycle in major economies and the speed of sustained disinflation in many countries," the bank said Wednesday in a statement.

Banco Central do Brasil last implemented a rate hike of 50 basis points in August 2022, bringing the rate to 13.75%, the highest since early 2017 and up sharply from a record low of 2% in March 2021.

It lowered its interest rate by 50 basis points to 13.25% in August 2023, its first rate cut in three years.

Consumer inflation in the South American country annually increased 0.83% in February, increasing its pace from a 0.42% month-on-month gain recorded in January.

Banco Central do Brasil's inflation projections stand at 3.5% for 2024 and 3.2% for 2025.