LatinNews Daily - 23 March 2023

In brief: Brazil maintains high interest rates

* Brazil’s central bank (BCB) has voted to maintain the benchmark interest rate at 13.75% for the fifth consecutive month, ignoring mounting pressure from President Luiz Inácio Lula da Silva for a reduction in the cost of borrowing. The announcement came amid continued inflationary pressure – monthly inflation stood at 0.84% in February, up from 0.53% in January, although annual inflation dropped from 5.77% to 5.60%. A BCB statement noted that “the external environment has worsened” over the past month due to volatility in the US and European banking systems, and also highlighted a deceleration of economic activity within Brazil. The announcement came one day after President Lula slammed the 13.75% interest rate as “irresponsible”, telling news website Brasil 247 that “I’m going to keep fighting to reduce interest rates so that the economy can once again have investment”.

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