LatinNews Daily - 30 March 2023

In brief: Lending by Brazilian banks falls for second month

* Brazil’s central bank (BCB) has released the latest figures on lending, showing that outstanding loans from banks fell for the second consecutive month in February. Outstanding bank loans in February totalled R$5.3trn (US$1.03trn). This was down by 0.1% on January, which in turn saw a 0.3% monthly decrease in bank lending. The monthly drop in lending in February was driven by a decrease in corporate loans, which fell by 0.7% to total R$2.1trn. In contrast, personal loans increased by 0.4% to total R$3.2trn. In year-on-year terms, lending was up by 12.6% in February, following a 13.8% yearly increase in January. The consecutive monthly decreases come amid warnings from President Luiz Inácio Lula da Silva that the BCB’s decision to maintain high interest rates (currently at 13.75%) risks triggering a credit crunch.

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