Brazil's central bank cuts benchmark interest rate to 7.00%

The Central Bank of Brazil recently announced that it cut its benchmark interest rate to 7%, in a widely expected decision. Below are the key highlights, via Reuters, from the bank's statement.

Interest rate decision was unanimous.

Recent economic indicators consistent with a gradual economic recovery.

External conditions have been favourable.

Inflation outlook has evolved largely as expected.

Outlook for inflation involves risks in both directions.

If its expectations are confirmed, new moderate reduction to pace of interest rate cuts would be appropriate in next meeting.

Outlook for next meeting more susceptible to changes than in prior meetings.

Monetary easing will depend on economic activity, balance of risks, assessment of magnitude of rate-cut cycle, inflation expectations.

At the current stage in rate-cutting cycle, caution warranted going forward.