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LatinNews Daily - 26 March 2021

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In brief: Brazil’s central bank revises up inflation forecast

* Brazil’s central bank (BCB) has released its latest quarterly inflation report, in which it revises up its forecast for inflation. It now expects inflation to close this year at 5%, up from the 3.4% projected in its December 2020 report. This means that inflation would exceed the BCB’s 3.75% target for this year, although it would remain within the +/-1.5 percentage-point tolerance margin. In its report, the BCB attributes the recent inflationary surprise” to higher commodities prices and the depreciation of the real. Inflationary pressures led the BCB to raise interest rates last week for the first time in six years, increasing the benchmark interest rate (Selic) by 75 basis points to 2.75%.