Brazil Reduced Benchmark Lending Rate to Nine-Month Low

Brazil´s central bank cut the benchmark lending rate to a nine-month low last week in a bid to shore up an economic expansion.

The nine-member board led by central bank President Henrique Meirelles lowered the benchmark overnight rate by half a percentage point to 18.5 percent. The rate slash is the third since September, when industrial output rose at its slowest pace in more than two years.

With inflation now taking a slow burn, central bankers will have more wiggle room to lower the benchmark rate to 14.5 percent by the end of next year in an effort to spark faster growth in Latin America´s biggest economy.

Industrial output stagnated in September, rising 0.2 percent from the year-earlier period, while vehicle sales rose 0.6 percent in October, the smallest increase in nine months.