Central Bank president Alexandre Tombini hinted several times over the last week that the monetary policy committee was “attentive” to rising interest rates. The 12 month rolling IPCA-15 inflation rate is around 6.4%, on the high end of the Bank’s tolerance band…
Wednesday initiates what will likely be a new and probably small tightening cycle. The overall tone of the monetary policy committee’s statement was surprisingly dovish, said Marcelo Salomon, an economist at Barclays Capital in New York. The decision to raise rates was split, and the two dissident votes were casted for no hikes (Directors Aldo Luiz Mendes and Luiz Awazu Pereira da Silva).
The BOVESPA is already down a stunning 13 percent for the year.
We totally got it wrong buying emerging markets last week. Thank goodness for stops and that’s not ketchup on our P&L.
(click here if chart is not observable)