Brazil’s central bank cuts benchmark lending rate by 50 basis points to 5.50%

Early Thursday morning in Asia, Brazilian central bank Banco Central do Brasil met market-wide expectations while announcing a 50 basis point (bps) cut to its benchmark rate of 5.50% now.

Key quotes (via Reuters)

“Decision was unanimous.”

“Consolidation of benign inflation outlook should give room for additional policy stimulus.”

“Economic data since last meeting consistent with gradual recovery.”

“Global economic outlook uncertain, risks of greater slowdown persist.”

“Underlying inflation at comfortable levels.”

“The central bank sees Inflation moving back to target over the relevant time horizon, which includes 2020 calendar year but sees inflation risk in both directions.”

FX implication

With the early Asian market emphasis being quite high on the Antipodeans, USD/BRL rose slightly to 4.1168 after the announcement with more action expected when the Brazilian markets open tomorrow.