Itau Says Above-Target CPI Outlook Prevents Brazil Rate Pause

Brazilian inflation forecasts need to drop to near the 3% target before policymakers could consider pausing interest rate rises, according to the chief economist at Latin America’s biggest bank.

In the past, the central bank has sometimes halted monetary tightening when inflation projections are still above target, but this cycle their room to maneuver is limited, said Mario Mesquita of Itau Unibanco.