Reuters: US Dollar Report: UPDATE 1-Analysts keep Brazil interest rate view unchanged

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UPDATE 1-Analysts keep Brazil interest rate view unchanged Apr 30th 2012, 11:47 Mon Apr 30, 2012 7:47am EDT * Market sees faster growth and inflation * Analysts expect rates to stay at 9 pct this year By Silvio Cascione SAO PAULO, April 30 (Reuters) - Economists kept unchanged their year-end forecasts for Brazil's benchmark interest rate at the current level of 9 percent even after the central bank left the door open for more rate cuts, a weekly central bank survey showed on Monday. The bank poll, which tracks weekly forecasts of the most-widely watched economic indicators in Brazil, showed higher estimates for inflation and economic growth as policymakers aggressively seek to spur economic growth in the world's sixth-largest economy. The central bank's monetary policy committee on April 18 cut its benchmark Selic interest rate by 75 basis points to 9 percent. The minutes of the bank's meeting removed the previous guidance that the Selic rate was likely to stay just above the all-time low of 8.75 percent, which analysts saw as indication that more rate cuts are dependent on the pace of recovery in Latin America's largest economy. Economists foresee prices climbing 5.12 percent by the end of this year, compared with last week's 5.08 percent prediction, and 5.53 percent next year, up from 5.50 percent the prior week. As inflation picks up, interest rates should be up again in 2013 to 10 percent, the poll showed. The median estimate for economic growth for 2012 rose to 3.22 percent from 3.21 percent. Analysts also revised up their estimates for growth in 2013 to 4.30 percent from 4.25 percent. The survey's results are the median forecast of analysts polled by the central bank at about 100 financial institutions. The central bank targets inflation of 4.5 percent annually, with a tolerance range of plus or minus 2 percentage points. Consumer prices were seen rising 0.56 percent in April, according to the median forecast of the central bank survey. For the next 12 months, inflation will likely be 5.53 percent, up from the previous forecast of 5.47 percent. Link this Share this Digg this Email Reprints

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