Brazil, Peru Rate Hikes Seen on Horizon

Brazil, Peru Rate Hikes Seen on Horizon

Bonds Corporate & Sovereign Strategy

Brazil and Peru should continue to raise benchmark rates, Goldman Sachs says in a note. The shop has altered its call, to a 60% probability that the October Copom meeting will reduce the pace of Brazil rate hikes to 50bp from 75bp. It expects additional hikes in December and January, resulting in a SELIC of 15.25%, with no decision to ease expected until October 2009. Goldman finds that in Peru, external turmoil is becoming grave enough threat to inflation to call for a raise to 7.00% by Decembe

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