BC holds 6.5% Despite the Selic in weak economy

Even with rate fall short for economic activity, the monetary policy Committee (Copom) of the Central Bank (BC) decided unanimously to keep the basic interest rate (Selic) to 6.5%. At the first meeting under the command of Economist Roberto Campos Neto, the Copom justified the decision as "caution, serenity and perseverance in monetary policy decisions, including on volatile scenarios, to maintain the trajectory of inflation towards the goals ". To the Economist of Santander Brazil, Rodolfo Margato, BC's decision was correct because Brazilian there are still many uncertainties on the horizon, including the approval of Social security reform by the National Congress. MONETARY POLICY keeps Selic 6.5% in BC despite the weak economy INN • posted in 21/03/19 at 05:00 even with rate fall short for economic activity, the monetary policy Committee (Copom) of the Central Bank (BC) decided unanimously to maintain the rate basic interest rate (Selic) to 6.5%. At the first meeting under the command of Economist Roberto Campos Neto, the Copom justified the decision as "caution, serenity and perseverance in monetary policy decisions, including on volatile scenarios, to maintain the trajectory of inflation towards the goals ". To the Economist of Santander Brazil, Rodolfo Margato, BC's decision was correct because Brazilian there are still many uncertainties on the horizon, including the approval of Social security reform by the National Congress. "If on the one hand, the decision of the Fed [Federal Reserve, the U.S. central bank] to also keep the interest there brings a relief for emerging countries, on the other, the slowdown of global trade, the issue of Brexit in Europe and the crisis in Argentina play in dir tion. Real is a coin very sensitive to this perception of risk, "says Margato. In the opinion of the Chief Economist of the new Future Investments, Pedro Paulo Silveira, pausing at high interest rates by the Federal Reserve opens up the possibility for the Selic reduction over the medium term. "If Congress approves pension reform, ensures a good likelihood of Copom download the Selic rate," he said. He estimates that global markets reacted positively to the Fed's decision.