Economy / Brazil
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Selic Rate On The Rise
April 2008 | Risk SummarySorry, you must be a subscriber to view this article in full. If you are a subscriber please login.
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The real is set to remain on an appreciating trajectory this year, although the extent of this strengthening against the dollar will in large part depend on how far the interest rate differential between Brazil's Selic rate and the US Federal Reserve 's funds rate will widen. Already at 900bps, the differential will likely grow as the US Fed will continue to lower interest rates in light of the looming recession in the US, and as the Banco Central do Brasil strikes an increasingly hawkish tone.