- The Central Bank of Brazil warned that inflation risks are skewed to the upside, suggesting that future adjustments to the easing cycle will depend on incoming data.
- Policymakers recently lowered the benchmark Selic rate by 25 basis points to 14.25% during their June 17 meeting.
- Both headline and underlying inflation measures have moved further above the central bank's 3% target, while long-term price expectations are becoming increasingly unanchored.
Quotes
“adjustments to its easing cycle will be made based on new information while also warning inflation risks are skewed to the upside, together boosting odds of a pause to interest rate cuts.”