March 23, 2020 / 11:38 AM / 2 months ago

Brazil central bank minutes show caution despite coronavirus

BRASILIA, March 23 (Reuters) - The coronavirus pandemic will deliver a hefty demand shock to Brazil’s economy, but worries over economic reforms and rising risk premia limited the central bank’s interest rate cut last week to 50 basis points, meeting minutes showed on Monday.

The minutes of the March 17-18 meeting of the rate-setting committee, known as Copom, also showed that policymakers felt anything other than a 50 bps cut in the benchmark Selic rate to a record low of 3.75% could have been counterproductive and led to an unwanted tightening of financial conditions. (Reporting by Jamie McGeever Editing by Brad Haynes)

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