USD/BRL: BCB calibration limits Real support – Societe Generale
|Societe Generale strategists comment from Brazil’s central bank Banco Central do Brasil (BCB) officials describing March’s 25 bp Selic cut as the start of a calibration process rather than an easing cycle. They stress commitment to the 3% inflation target and downplay the recent break of USD/BRL below 5.00, leaving the scale of future adjustments open and data‑dependent ahead of the April 29 COPOM meeting.
BCB stresses inflation target over FX
"In EM, Brazil central bank monetary policy director Nilton David last week emphasized the importance of meeting the 3% inflation target and characterised the cautious 25bp Selic rate cut in March as the start of a ‘calibration process’ and not easing."
"Crucially, he asserted that the BCB does not count on real appreciation to deliver disinflation, implicitly downplaying the break of USD/BRL below 5.00."
"Fellow BCB official Paulo Picchetti noted that the scale of policy calibration is open with ample scope for data to reshape views ahead of the COPOM meeting on 29 April."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.