BRASILIA, Jan 25 (Reuters) - Consumer confidence in Brazil rose in January as a surprise inflation drop allowed the central bank to cut interest rates more aggressively, easing the burden on debt-laden families, a private survey showed on Wednesday.
The Getulio Vargas Foundation, or FGV, index of consumer confidence rose to 79.3 in January from a six-month low of 73.1 in December.
After inflation fell sharply, the central bank began easing monetary policy more rapidly in January and signaled interest rates could be reduced from 13 percent to single digits in coming months.
“Although uncertainty remains high and prospects for the labor market continue to look bad, the good news that came with the new year raised the likelihood of a confidence rebound,” FGV economist Viviane Bittencourt said in a statement.
Economists expect the Brazilian economy to start a slow recovery in 2017 from its two-year recession, the worst in the country’s history. (Reporting by Silvio Cascione; Editing by Lisa Von Ahn)