Brazil signaled that the world’s longest rate tightening cycle might be coming to an end and raised borrowing costs for a ninth straight meeting.
The bank’s board, led by its President Alexandre Tombini, today voted unanimously to raise the Selic rate to 11 percent from 10.75 percent, as forecast by all 57 economists surveyed by Bloomberg. Policy makers have raised borrowing costs by 375 basis points, or 3.75 percentage points, in less than a year.
The bank at its last meeting in February signaled that tightening might soon end by halving the pace of rate increases. Brazil in the last year has increased borrowing costs more times than any other central bank worldwide, with the total increase in borrowing costs trailing only Turkey among major economies. Policy makers’ efforts have also been helped by the second-biggest currency gain among emerging markets since January.