LatinNews Daily - 03 February 2022

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In brief: Brazil’s interest rates enter double digits

* The monetary policy committee (Copom) in Brazil’s central bank (BCB) has raised the country’s benchmark interest rate, the Selic, by 150 basis points (bps) to 10.75%. This is the first time that the Selic has entered the double digits since July 2017. The rate hike was expected as the BCB has indicated that it will continue its policy of monetary tightening until inflationary pressures are brought under control (beyond-target inflation is expected in 2022, with the Copom currently forecasting 5.4% inflation this year). The Copom nevertheless indicated that it would start decreasing the pace of the rate hikes; this was the eighth consecutive increase in the Selic since the BCB began raising rates in March last year, and the third consecutive 150 bps increase.  

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