Brazil’s swap rates dropped for a fourth straight day on speculation that policy makers convening for a two-day meeting will limit borrowing cost increases to a quarter-percentage point.
Swap rates on contracts due in January 2017 sank three basis points, or 0.03 percentage point, to 12.13 percent at 9:30 a.m. in Sao Paulo, the lowest since Dec. 18. The real appreciated 0.2 percent to 2.3359 per dollar.
Central bank policy makers will raise the benchmark lending rate by 25 basis points tomorrow to 10.75 percent, according to the median estimate of 59 economists surveyed by Bloomberg, after six straight increases of a half-percentage point. Brazil’s construction costs index rose 8 percent in February from a year earlier, the slowest since September, the Getulio Vargas Foundation reported.
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