In a move to inject 6.5 billion Brazilian reais in deposited funds into the economy, Banco Central do Brasil said it has lowered reserve requirements for demand and time deposits effective Jan. 2, 2018.

The central bank said the decision will help simplify compulsory collection and gradually reduce existing operational complexity while subsequently reducing compliance costs.

Meanwhile, Ilan Goldfajn, Brazil's central bank president, projected there will be a cut in the benchmark Selic rate when the next monetary policy meeting is held in February, Reuters reported.

The current rate stands at 7%.

As of Dec. 19, US$1 was equivalent to 3.30 Brazilian reais.