November 4, 2019

Chart of the Week: Brazilian bonds bounce back, but will it last?

by Fathom Consulting.

Brazil’s central bank cut its key policy rate from 5.5% to 5.0% in October, taking the rate to the lowest level in more than two decades. The move follows that of many other central banks in both advanced economies and emerging markets, with global inflationary pressures remaining subdued. Inflation in Brazil has declined too, falling from 3.4% to 2.9% in September, and the country’s central bank suggested that it would trim the policy rate by another 50 basis points to 4.5% in December. The cutting cycle has underpinned a rally in the country’s bonds, but investors will be hoping that this does not prove to be a false dawn, as it was in 2012. Back then, the policy rate was cut significantly, but these cuts were subsequently reversed as inflation began to rise. That hiking cycle coincided with the worst recession in the country’s recent history.

Refresh the chart in your browser Edit chart in Datastream



Financial time series database which allows you to identify and examine trends, generate and test ideas and develop view points on the market.

Refinitiv offers the world’s most comprehensive historical database for numerical macroeconomic and cross-asset financial data which started in the 1950s and has grown into an indispensable resource for financial professionals. Find out more.

Article Keywords ,

Get In Touch


We have updated our Privacy Statement. Before you continue, please read our new Privacy Statement and familiarize yourself with the terms.×