Brazil: COPOM to ease rates by 100bps today - TDS

Analysts at TDS continue to maintain their call for 100bps of easing by the COPOM today, but feel that there is definitely scope for the BCB to provide stronger guidance (and thus market surprise) for rates now that the political situation is highly uncertain.

Key Quotes

“There was an increased risk of the pace of easing being accelerated, however we'd likely not see that given recent political events and the impact on fiscal reform, unless the BCB decided to make a significant ‘one more and done’ cut, and then make further easing conditional on political resolution.”