Brazil's central bank monetary policy meeting minutes show inflation fears

Sao Paulo, on February 8 (xinhua Luo Jing Jing) local time on February 7, the Brazilian central bank monetary policy committee meeting minutes before the release of one week, points out that the deterioration of long-term inflation expectations and do not rule out the possibility of continue to raise interest rates.

Last week, Brazil's central bank monetary policy committee held 2023 annual policy meeting for the first time, decided to maintain the 13.75% benchmark interest rate unchanged. This is the highest rate since January 2017, the country level, at the same as the current interest rates.

File points out that, despite the growth decline, consumer inflation is still high. The economic cycle and monetary policy shows that the most sensitive areas of greater inflation inertia, is still higher than the inflation target range.

Monetary policy committee, is expected to Brazil in 2023 and 2024, inflation will be 5.6% and 3.4%, respectively.

At present, Brazil's inflation outlook two situations may occur. On the one hand, the fiscal policy framework and fiscal stimulus is highly uncertainty, global inflation pressure, output gap led to the upside risks to inflation. In local currency terms, on the other hand, the global commodity prices fall further, the global slowdown in economic activity, and tax reduction policy reversal may make inflation down.