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Brazil central bank president says more rate cuts possible

Banco Central do Brasil could further reduce its benchmark interest rate due to the balance of economic risks and persistently low inflation, central bank President Roberto Campos Neto said, according to a Reuters report.

"The next steps of Brazil's monetary policy will continue to depend on economic activity, the balance of risks, and the projections and expectations related to inflation," Campos Neto said.

However, a delay in the passage of economic reforms could increase inflation and the risk premia, the official noted.

The comments come after the central bank cut the Selic rate to 6.00% at the end of July and reiterated the expectation that the monetary rate will end the year at 5.50%.

Meanwhile, Campos Neto highlighted the need for central bank autonomy and emphasized its role in stabilizing the economy during political transitions. "The cost of controlling inflation (loss of GDP) is lower the greater the autonomy of the central bank," he said.