Brazil Interest Rate Announcement (Jan.)

Brazil’s central bank delivered on its pledge to deliver another 100bp hike to the Selic rate, to 13.25%, and another 100bp increase at March’s Copom meeting is all but certain. For now, we are sticking with our view that that will mark the end of the tightening cycle, but a fresh flare up of fiscal concerns, renewed falls in the real and upside surprises in the inflation data all present upside risks to the rate outlook.