Thursday, February 23, 2017

Copom seen as leaving options open for faster rate cuts

Economists told Valor the Monetary Policy Committee (Copom) of the Central Bank left open the possibility of accelerating the pace of monetary easing in upcoming meetings. The Copom lowered policy rate Selic by 75 basis points to 12.25% on Wednesday. Maurício Molon, chief economist of Santander, says the market tends to react as soon as Thursday by pricing in the possibility of a 100bp cut in the next meeting, in April, if inflation trends remain favorable or the economic recovery proves even harder.