MNI BRIEF: Some BCB Members Argued For Slower Cuts- Minutes
According to the minutes, Brazil's Central Bank decided to shift its forward guidance to gain flexibility.
Some members of Brazil's Central Bank board argued in favor of a deceleration in the easing cycle pace, currently running at 50 basis points a meeting, if "uncertainty remains high in the future," minutes of the last meeting showed on Tuesday.
"Some members also argued that if prospective uncertainty remains high in the future, a slower pace of monetary easing may prove appropriate, for whatever terminal rate is desired," said the document. According to the minutes, BCB decided to adjust its forward guidance to gain flexibility and board members added that last-minute changes to guidance could damage credibility and should be avoided. (See MNI INTERVIEW: New Brazil Guidance Doesn't Mean Slower Easing)
After cutting the Selic rate by 50bp to 10.75% last week, Copom said it expects an additional cut of the same size at the "next meeting," after having earlier anticipated half-point moves at the "next meetings."