SAO PAULO, Oct 7 (Reuters) - Expectations for Brazilian interest rates and exchange rates for this year are seen holding steady, according to a central bank survey of economists published on Monday, with their low levels suggesting further monetary policy easing is on the cards.
In line with the previous week’s FOCUS survey of economists, the dollar is expected to end this year at 4.00 reais while the benchmark Selic interest rate will be 4.75%.
Last month, the central bank’s policymaking committee, known as Copom, reduced the Selic rate by 50 basis points to a record low of 5.50%, and gave a clear signal that it is prepared to cut again assuming inflation remains well contained.
In its Quarterly Inflation Report last month, the central bank said that based on the market’s consensus exchange rate and interest rate forecasts, inflation will be well below target next year at 3.80%.
The Brazilian currency is currently trading at just over 4 reais to the dollar . (Reporting by Camila Moreira; Editing by Steve Orlofsky)