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Brazil's basic interest rate down to 13 pct

Xinhua, January 12, 2017 Adjust font size:

Brazil's Monetary Policy Committee (Copom) announced on late Wednesday its decision to cut the country's annual basic interest rate Selic from 13.75 percent to 13 percent.

It was the third consecutive reduction of the Selic rate and the first time Copom decided to make a 0.75-point reduction in the last five years, indicating that Copom is accelerating the reduction of the country's interest rate.

With the Copom decision, the Selic rate is now at the lowest level since April 2015. In a recent poll, financial market executives estimated that the Selic rate would be further cut and fall to 10.25 percent by the end of 2017.

Earlier on Wednesday, Brazil's official statistics agency announced that the country's inflation indicator IPCA fell to 6.29 percent from 10.6 percent in 2015. IPCA is the Brazil's official inflation index, and its upper limit target in 2016 is 6.5 percent.

According to Brazilian President Michel Temer, a lower Selic rate will create necessary conditions for the country's economic growth to resume. Endi