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Brazil central bank steps up tightening with 50 bp rate hike

BY Reuters | ECONOMIC | 11/06/24 04:41 PM EST

BRASILIA, Nov 6 (Reuters) - Brazil's central bank raised interest rates by 50 basis points on Wednesday, quickening the pace of tightening from September as it grapples with a more challenging inflation outlook.

The bank's rate-setting committee, known as Copom, voted unanimously to lift its benchmark Selic rate to 11.25% as widely expected. In a Reuters poll of 34 economists, 30 forecast an increase of that magnitude, while four expected a 25 basis-point hike. (Reporting by Marcela Ayres Editing by Brad Haynes)

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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