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Brazil's central bank cuts benchmark rate to 6.5%

Banco Central do Brasil's monetary policy committee, or Copom, unanimously decided to cut its Selic rate by 0.25 percentage point to 6.5% per year, citing inflation expectations and the stage of its monetary easing.

The central bank said its baseline inflation scenario evolved in a steady fashion and remained favorable, adding that its inflation projections stand at about 3.8% in 2018 and 4.1% in 2019. Copom added that its scenario "assumes a path for the policy interest rate that ends 2018 at 6.5%, and 2019 at 8.0%."

In addition, the bank noted the consistent recovery of the Brazilian economy and a favorable global outlook.

"Regarding the next meeting, at this time the Copom views an additional moderate monetary easing as appropriate," the central bank said. "This view regarding the next Copom meeting might change in favor of the interruption of the monetary easing process, if risk mitigation proves unnecessary."