Brazil's central bank Wednesday kept its key rate steady at a historically low 6.5 percent, showing caution as President Jair Bolsonaro's government readied structural reforms meant to boost the economy. The decision adopted unanimously by the bank's Monetary Policy Committee aligned with forecasts by most analysts.
In a statement, the committee said that it has seen a "reduction of inflationary risks" since its last meeting in December. But it said international context remained "challenging" and that obstacles to the anticipated reforms could "elevate the inflationary trajectory."
It said it intended to act with "prudence, serenity and perseverance" with the aim of keeping inflation within its target range. The central bank has kept is key Selic rate unchanged at 6.5 percent since March 2018.
Analysts said the bank had to pick a path between shoring up modest growth after exiting in 2017 a crushing recession and weighing the impact of changes Bolsonaro and his free-market Economy Minister Paulo Guedes want to implement.