Economics
Big Deflation Sparks Talk of No Rate Hike in Brazil Next Year
- Economists and traders delay outlook for monetary tightening
- November consumer price drop was led by electricity and fuels
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Bets that Brazil may hold interest rates at a record low throughout 2019 gained strength on Friday after the country posted its biggest monthly deflation in 1-1/2 years.
Consumer prices measured by the benchmark IPCA index fell 0.21 percent in November, three times as much as economists expected. Swap rates on futures contracts, a barometer of expected interest-rate decisions, dove following the data’s release. The most-traded contract, maturing in January 2021, fell 13 basis points to 7.78 percent by midday.