On December 5 and 6 (Tuesday and Wednesday), Brazil’s Monetary Policy Committee (Copom) will hold its last meeting in 2017. The committee will decide if it changes the country’s benchmark interest rate (Selic), currently at 7.5 per cent per year. Economists polled by the Central Bank kept their estimates at 7 per cent.
The set of economic activity indicators released since the last Copom meeting is consistent with a gradual recovery of the Brazilian economy, that continues to operate with a high level of economic slack, reflected in the low industrial capacity utilization indexes and, mainly, in the unemployment rate.
Inflation developments remain favorable, with various measures of underlying inflation running at comfortable levels. This includes the components most sensitive to the business cycle and monetary policy.