Brazil’s central bank keeps interest rate steady at 13.75%

By Ovunc Kutlu

ISTANBUL (AA) – Brazil’s central bank kept its interest rate stable at 13.75%, in line with market expectation, the bank announced late Wednesday.

The rate has been the highest since January 2017.

Banco Central Do Brasil last made a rate hike of 50 basis points on Aug. 3, carrying the interest rate to 13.75%, which is significantly up from the record low of 2% in March 2021.

"The global environment remains adverse and volatile, marked by prospects of below-potential global growth for next year, high volatility of financial assets and an inflationary environment that remains under pressure," the bank said in a statement.

The central bank said the third quarter gross domestic product suggested a more moderate growth rate, and added that consumer inflation remains high despite its recent reduction, especially on items which are more volatile and affected by tax measures.

Gain in Brazil's annual consumer inflation rate slowed down in October for the third consecutive month. The consumer price index rose 6.47% in October year-on-year, but it was a sharp decline from annual gains of 7.17% in September, 8.73% in August, and 10.07% in July.