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Brazil hikes interest rates to 13.75% as expected

Henrique Meirelles, president of central bank of Brazil, visits the headquarters of CME Group Inc.'s global command center in Chicago, Illinois, U.S., on Friday, on Nov 5, 2010.

[BRASILIA] Brazil's central bank raised interest rates to 13.75 per cent from 13.25 per cent as expected on Wednesday, opting for another steep hike despite fears higher borrowing costs will sink Latin America's largest economy deeper into recession.

The bank's monetary policy committee, known as Copom, voted unanimously to hike the benchmark Selic rate by 50 basis points for the fifth straight time. The move was expected by an overwhelming majority of economists and traders.

The bank made no changes to the wording of the decision statement when compared to the previous meeting.


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