|
RIO DE JANEIRO, Nov. 30 (Xinhua) -- Brazil's Monetary Policy Committee (Copom) announced Wednesday the reduction of the country's annual basic interest rate Selic from 14 to 13.75 percent.
It was the second consecutive reduction in the Selic rate since its last cut introduced four year ago.
The Committee's decision was unanimous. The Selic rate is now at the lowest level in 16 months, but Brazil still has the highest real interest rate -- basic interest rate minus inflation -- in the world.
In their statement, the Copom observed that the convergence of the inflation rate to the target, which is 4.5 percent with a two-point gap, meaning the rate cannot exceed 6.5 percent, is compatible with a reduction in the interest rate.
Earlier in the day, governmental statistics agency IBGE announced that Brazil continues to face a recession, and the third quarter's gross domestic product fell 0.8 percent compared to the second quarter and 2.9 percent year-on-year.
The market already expected a reduction in the Selic rate in the last Copom meeting of 2016. They expect the rate to be further reduced in the next meeting, which takes place in January.
