In line with expectations and forward guidance, Brazil’s Central Bank’s Monetary Policy Committee (Copom) cut the Selic rate by 50bp to 10.75% in a unanimous decision. However, there was a key change in the forward guidance. Due to increased uncertainty and a desire for flexibility, the BCB is now only guiding to a 50bp cut at the next meeting (singular), not meetings (plural). The BCB also noted that now underlying inflation measures were above target in recent releases, effectively backtracking after recent statements that said underlying inflation measures were close to target.
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