Tidbits
U.S. inflation at the retail level increased 0.3% in November, the most in 7 months, but the Federal Reserve is still expected to cut interest rates next week to support job growth. However, the decline in the inflation rate has come to an end and the Federal Reserve's inflation goal of 2% per year is well below the November annual rate of 3.6%.
Yesterday, the Bank of Canada reduced its base interest by 50 basis points (one-half percent) to 3.25%. Just a few months ago, the rate was 5%.
Brazil’s central bank raised interest rates by 100 basis points (1%) to 12.25%. If the proposed roadmap is followed, the benchmark borrowing rate could soar to an eight year high of 14.25% as early as March reflecting the central bank’s determination to curb rising inflation expectations amid robust economic activity, a tight labor market and a weaker currency. That higher interest rate will tend to strengthen the Brazilian currency, making the country’s products more expensive on the world marketplace.