Itaú BBA - Copom: Leaving the door open for further cuts

Macro Brazil

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Copom: Leaving the door open for further cuts

diciembre 11, 2019

The statement does not commit to additional rate cuts, but does not rule them out either.


For the version with all charts and tables, please open the attached pdf file
 

 The Copom delivered the expected outcome, a 50-bp rate cut to 4.5% pa. Its statement does not commit to additional rate cuts, but does not rule them out either. In fact, the set of forecasts presented in the statement, particularly those for 2020 (3.5% and 3.7% in the market and hybrid scenario, respectively, compared with a 4.0% target) suggests that there is scope for additional easing, and we still expect the base rate to end the cycle at 4% pa by early 2020. We´ll learn more about the rationale for this decision with the release of the meeting minutes on Tuesday, December 17, and the publication of the Quarterly Inflation Report, on Thursday, December 19.


For the version with all charts and tables, please open the attached pdf file



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