13
Oct
At 15%, Brazil’s monetary policy interest rate (called Selic) is one of the highest among major economies. Yet in 2024, bank credit grew by 11.5%, and corporate bond issuance rose by 30%. This credit expansion in the face of high policy rates benefited many individuals, households, and companies. But it also raised questions about the effectiveness of monetary policy itself. In other words, why did the central bank’s efforts to cool down the economy by making financing more expensive seem not to be working? Our analysis, in the context of Brazil’s latest yearly economic review, shows that concerns have been…
