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Brazil central bank holds rates steady despite slowdown

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Brazil's interest rates remained unchanged on Wednesday after the central bank held its first monetary policy meeting under its new chief Roberto Campos Neto.

[BRASÍLIA] Brazil's interest rates remained unchanged on Wednesday after the central bank held its first monetary policy meeting under its new chief Roberto Campos Neto.

The central bank's unanimous decision - only the second since pro-business President Jair Bolsonaro took power in January on a promise to revive Latin America's biggest economy - to keep rates at 6.5 per cent was in line with market expectations.

Rates have been at the historic low for a year and the bank gave no indication of plans to cut them any time soon despite slowing growth.

The decision disappointed the powerful National Confederation of Industries, which issued a statement saying "the weak performance of economic activity shows that Brazil must reduce rates."

Brazil's economy is still bearing the scars of the record recession in 2015-2016, with growth barely above one per cent in the past two years.

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Recent economic indicators, though, show signs of a contraction in 2019.

AFP

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