By Ovunc Kutlu
ISTANBUL (AA) - Brazil’s central bank lowered its benchmark interest rate by 25 basis points to 10.50%, down from 10.75%.
"The global environment has become more adverse because of the heightened and persistent uncertainty about the beginning of the easing cycle in the United States and the speed of sustained disinflation in many countries," the bank said in a statement late Wednesday.
"The central banks of major economies remain committed to bringing inflation back to its targets in a context characterized by labor market pressures. The Committee judges that the environment continues to require caution from emerging market economies," it added.
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 slowed down both annually and monthly in March, coming in at 3.93% and 0.16%, respectively; after 4.5% and 0.83% monthly gains in February.
The central bank monetary policy committee's inflation projections stand at 3.8% for 2024 and 3.3% for 2025.