![Brazil hikes key interest rate to double digits](https://www.portugalcolonial.pt/media/shared/articles/3e/88/b8/Brazil-hikes-key-interest-rate-to-d-786644.jpg)
-
Spacecraft to swing by Earth, Moon on path to Jupiter
-
What's the fallout of Mexican drug lords' capture?
-
Video game makers see actors as AI 'data,' says union on strike
-
Chinese qualifier Shang to face Thompson in ATP Atlanta semis
-
'Massive attack' on French rail threatens more chaos
-
'We did it!': France breathes sigh of relief after Olympics ceremony
-
Regional concern grows as Venezuela blocks vote observers
-
Historic river parade, Dion show-stopper ignite Paris Olympics
-
Rainy Paris Olympic parade dampens many spectators' spirits
-
The one of a kind Paris opening ceremony: five memorable moments
-
Justin Timberlake seeks to dismiss DUI case
-
Warner Brothers Discovery sues NBA over Amazon rights deal
-
Kobe Bryant locker, Maradona jersey up for auction in New York
-
Historic river parade launches Paris Olympics
-
New York family of Holocaust victim reclaims Nazi-looted art
-
NASA Mars rover captures rock that could hold fossilized microbes
-
Thousands evacuate season's biggest wildfire in northern California
-
Ethiopia mourns victims of landslide tragedy
-
Lady Gaga adds sparkle to star-studded Olympic show
-
Airbus and Boeing supremacy secure despite turbulence
-
Teams sail down Seine in rain-soaked Olympics opening ceremony
-
West Indies' treble strike rocks England in third Test
-
Olympic opening ceremony under way on River Seine
-
Mott's England future uncertain as ECB chief fails to offer support
-
Trump meets Israeli PM Netanyahu in Florida
-
S.African police say 95 Libyans detained at suspected military camp
-
Blinken set for talks with Chinese counterpart in Laos
-
Norris heads Piastri in McLaren one-two at Belgian GP practice
-
G20 seeks common ground on taxing super-rich
-
European medicines watchdog rejects new Alzheimer's drug
-
Habib, Ebden eye Alcaraz and Djokovic shocks at Olympics tennis
-
Long queues, ticketing problems ahead of Paris opening ceremony
-
Two Sinaloa Cartel leaders face US charges after stunning capture
-
Spain train driver jailed for 2.5 years over deadly 2013 crash
-
Paris poised for Olympic opening ceremony spectacular
-
Judoka fails doping test in first case at Paris Olympics
-
Holder and Da Silva keep England at bay after West Indies collapse
-
Alpine F1 boss Bruno Famin to leave in August
-
Ethiopia declares three days of mourning after landslide tragedy
-
Brazilian dunes dotted with dazzling pools make UNESCO heritage list
-
Rain, cooling slow huge blaze in Canada's Jasper park
-
French Rugby's Jaminet suspended 34 weeks after racist video: Federation
-
Osaka looking to turbo-charge comeback at Paris Olympics
-
Russian central bank hikes key rate to fight inflation
-
Verstappen tops times in opening practice, faces grid penalty
-
UK to reveal £20 bn hole in public finances: reports
-
Gaming sector recovery on flamboyant display at ChinaJoy expo
-
Biles ready to unveil unique uneven bars skill at Paris Olympics
-
Players unaware of spying scandal as Canada Olympic coach sent home: official
-
Snoop Dogg stars as flame sails into Paris for opening ceremony
![Brazil hikes key interest rate to double digits](https://www.portugalcolonial.pt/media/shared/articles/3e/88/b8/Brazil-hikes-key-interest-rate-to-d-786644.jpg)
Brazil hikes key interest rate to double digits
Brazil's central bank hiked its benchmark interest rate by 1.5 points Wednesday to 10.75 percent, bringing it into double digits for the first time in nearly five years to fight rampant inflation.
The eighth straight increase to the Selic rate, which was in line with forecasts, comes as Latin America's biggest economy struggles through a recession and stubbornly high inflation that the bank's monetary policy committee said "continued to be a negative surprise."
The nine-member committee, which made the decision unanimously, hinted it would soon slow the tightening cycle, saying it "currently foresees a slowdown in the pace (of rate cuts) as the most adequate policy."
Brazil has responded to pandemic-driven inflation with one of the most aggressive tightening cycles in the world, rapidly raising the key interest rate from an all-time low of two percent in March 2021.
The last time the Selic rate was in the double digits was in May 2017.
Brazil's inflation rate came in at 10.06 percent for 2021, crashing through policymakers' target range -- currently 3.5 percent, plus or minus 1.5 percentage points.
But the hawkish monetary policy is putting the brakes on economic growth.
The economy fell into recession last year, contracting 0.4 percent in the second quarter and 0.1 percent in the third.
Analysts polled by the central bank are currently forecasting economic growth of a lackluster 0.3 percent for this year.
- Election year -
The weak economy has emerged as a major headache for far-right President Jair Bolsonaro, who is up for reelection in October and badly trails his nemesis, leftist ex-president Luiz Inacio Lula da Silva, in the polls.
Election-year and pandemic-related uncertainties loom large for Brazil's economy, but there are tentative signs of improvement.
The monthly inflation rate slowed at the end of the year, from 0.95 percent in November to 0.73 percent in December.
And industrial production came in at a stronger-than-expected 3.9 percent growth for 2021, according to figures released Wednesday -- though it remains 0.9 percent below its pre-pandemic level.
Central bank chief Roberto Campos Neto recently said he expected the rate-tightening cycle was "reaching its end."
The bank's next meeting is set for mid-March. Many analysts forecast the last rate hike will come in May, bringing the Selic to around 12 percent.
G.Machado--PC