brazils central bank cut its benchmark interest rate by half a percentage point the first change to the rate in a year and said it expects to make more cuts of the same size at coming policy meetings the banks monetary policy committee or copom reduced its key selic rate to 1325 from 1375 after raising it to that level in august 2022 the move reverses a rateincrease cycle launched in march 2021 when the selic was at a record low of 2 the bank said it considered cutting the selic by only a quarterpoint but chose to make a larger cut because of continuing improvement in the countrys inflation outlook if the scenario evolves as expected the committee members unanimously anticipate further reductions of the same magnitude in the next meetings and it judges that this pace is appropriate to keep the necessary contractionary monetary policy for the disinflationary process the central bank of brazil said in a statement five members of the copom voted for the halfpoint cut while the other four voted for a quarterpoint cut the likely start of a ratecutting cycle comes after the banks efforts to slow consumer price increases helped bring the 12month inflation rate down from an almost 19year high in june the rate stood at 316 down from 1213 in april 2022 which was the slowest pace for inflation growth since october 2020 consumer prices declined 008 in june from may the bank began raising the selic after inflation started to pick up toward the end of 2020 and then rose more rapidly as the countrys economy recovered from the pandemicinduced slowdown the russian invasion of ukraine later pushed inflation even higher as energy and food prices gained amid supply disruptions higher interest rates are now having the expected impact on inflation and the economy and other factors are also helping calm concerns at the central bank said matheus pizzani an economist at brokerage cm capital the more recent evolution of inflation has been closer to what was hoped pizzani said high rates are helping slow the economy concerns about the new brazilian governments fiscal policies have eased and the outlook for services inflation is improving he said