The baseline scenario continues to count the Brazil Central Bank key rate (Selic) on hold at the historical low of 6.5% for
Key Quotes:
“In the minutes of last week’s Copom policy meeting, we saw the committee even more emphatic on the scraping of the forward guidance, amid a scenario of high uncertainty.”
“The BCB continues to stress on the will to fight only secondary effects on the inflation outlook caused by the recent shocks, still seen by the authority as relative price changes. In the end, the Copom reaffirmed “the importance of insisting on communicating that there is no mechanical relationship between recent shocks and (“¦) monetary policy.”
“We believe that, with recent communications, the BCB seeks to buy more flexibility for itself amid rising uncertainties both at external and domestic levels. These uncertainties justify the scrapping of the forward guidance, meaning that the BCB can no longer commit to keeping rates on
“While refraining to provide a flight plan, the current conditions and outlook still seem consistent with