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Rio De Janeiro, Brazil — Brazil’s central bank on Wednesday announced its first interest rate hike in two years, raising the benchmark lending rate to 10.75 percent even as the US Federal Reserve decided to lower borrowing costs.
The central bank of Latin America’s biggest economy raised the rate by a quarter of a percentage point over inflation concerns, marking a setback for President Luiz Inacio Lula da Silva, who had pushed hard for lower rates.
The move came on the same day the US Fed lowered its benchmark rate for the first time in four-and-a-half years, shaving off half a percentage point to leave it at between 4.75 percent and 5.00 percent.
Wednesday’s increase won the unanimous approval of members of the Central Bank’s Monetary Policy Committee (COPOM).
