Central Bank keeps benchmark interest rate at 6.5% per year

At its first meeting of the year, the Brazilian Central Bank's board kept the benchmark interest rate (Selic) unchanged at 6.5% per year, the lowest ever. The decision was unanimously taken this Wednesday (February 6). According to the statement released after the decision, inflation continues at appropriate or comfortable levels and the Brazilian economy shows signs of gradual recovery.

For the Central Bank, the implementing of economic reforms will be essential to keep inflation low, interest rates on the decline and the economy growing in the medium and long terms.

How the SELIC is set

The evolution of the benchmark interest rate (Selic) is decided by the Central Bank board in a closed-doors meeting. This meeting, which convenes what is referred to as the Monetary Policy Committee (Copom), takes place eight times a year, every 45 days.

Any definition to drop, maintain or increase the country's interest rate is closely monitored by economic agents such as analysts, banks, businesspersons and investors. This is because this rate drives all others practiced by the market, and has important effects on the population's access to credit, inflation and economic growth.