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Central Bank Minutes Add Little To COPOM Statement

BRAZIL

BRAZIL Central Bank Minutes in line with the COPOM statement:

  • FORWARD GUIDANCE CONDITIONS STILL SATISFACTORY
  • GUIDANCE CONDITIONS MAY SOON NOT BE SATISFIED
  • GUIDANCE REMOVAL WOULDN'T IMPLY IMMEDIATE RATE HIKE
  • FISCAL CHANGES COULD CAUSE GUIDANCE REVIEW
  • BRAZIL CENBANK SAYS INFLATION SHOCKS ARE TEMPORARY
  • BRAZIL CENBANK: FISCAL RULES WERE NOT CHANGED (all bbg)
No real surprises here. Continue to see inflation surge as transitory and despite the fiscal rules not being changed, any potential changes would lead to a review of the forward guidance. The Emergency Bill developments will be monitored closely over the next month. Important to note the committee reiterates a removal of the guidance "would not mechanically imply an increase in interest rates."

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