Brazil Raises Key Interest Rate

SÃO PAULO, Brazil—Brazil’s central bank raised its benchmark interest rates less than what many economists say is needed to keep inflation in check, in a gamble that the soaring global food prices helping drive inflation higher will eventually ease off by themselves.

The bank raised its benchmark interest rate a quarter of a percentage point to 12%. That was a smaller raise than two previous increases of half a percentage point earlier this year.

“They are capitulating in terms of their inflation target for this year and are going to let inflation run through system,” says Alberto Ramos, an Latin …

Read the rest here.