The Minutes of the Monetary Policy Conference issued by the Central Bank of China Central Bank Monetary Policy Committee show that in view of the country's inflation and its impact on the official inflation prediction data of Brazil, most members believe that the next monetary policy meeting held in August may decide to reduce interest rates.
The Brazilian central bank held a monetary policy meeting a week before decided to maintain the current 13.75%benchmark interest rate.Commissioners generally consider that Brazil's current tightening tightening and its impact on market expectations has created conditions for the next meeting in early August to start a slightly gradual interest rate reduction process.
However, a small number of members are more cautious.They believe that although the current ease of inflation reflects the weakening of many unstable factors, the uncertainty of the output gap has caused people to doubt the effect of the currency tightening policy implemented so far.
Therefore, the committee stated that the next monetary policy decision will depend on the official inflation data, market inflation expectations, output gaps, and assessment of future inflation levels.
The market is expected to reduce the benchmark interest rate of Brazil to 13.50%from August and to 12.25%at the end of the year.
Because the impact of adjusting the benchmark interest rate on the economy is often fully reflected in 6 months to 18 months. At present, the Brazilian central bank has begun to prepare for the monetary policy goals in 2024.
The Brazilian National Monetary Commission is 3%of the inflation target set in 2024 and 1.5%to 4.5%.Due to the annual increase of inflation level in Brazil in May, the Brazilian financial market was reduced from 5.12%to 5.06%of Brazil's 2023 inflation prediction last week; the inflation expectations in 2024 were reduced from 4%to 3.98%.
Brazilian President Lula has repeatedly put pressure on the central bank to start the process of starting interest rate cuts and criticize the impact of high interest rates on economic growth and employment opportunities.
After the meeting of the meeting was released, the Brazilian Bank Uta Bank expected the central bank's interest rate cuts from September to August in the analysis report. It is expected that the interest rate reduction is 25 basis points, and the valuation of the benchmark interest rate at the end of the year will be reduced from 12.5%to 12.25 at the end of the year to 12.25%.
The economy generally believes that the Brazilian central bank is expected. Most economists are expected to cut interest rates at 25 basis points for the first time, and some optimists are expected to cut interest rates 50 basis points.
The Brazilian Geographical Bureau released a report on the 27th that the "National Consumer Price Index 15 (IPCA-15)", known as the Brazilian inflation forward-looking index, increased by 0.04%from the previous month in June this year, a decrease of 0.47 from 0.51%in May this year.percentage point.In the past 12 months as of June, the index increased by 3.4%, lower than the increase of 4.07%in May.
