Brazil central bank raises interest rate to 9-year high

BRASÍLIA, Mar 19 (AFP): Brazil's central bank on Wednesday hiked its key interest rate one point to 14.25 per cent, a nine-year high, as it seeks to contain inflation in Latin America's largest economy.

It was the fifth consecutive increase, and counter to leftist President Luiz Inacio Lula da Silva's calls for a lower rate to boost economic growth.

The bank's Monetary Policy Committee cited a "challenging external environment" for its decision, as well as persistent inflation domestically and signs of an "incipient moderation in growth."

The committee forecast another rate hike, of a "smaller magnitude," from its next meeting in May, if current conditions persist.

The rate was last this high between July 2015 and October 2016, when Brazil was in the grips of an economic recession. Lula, battling low approval ratings, argues that high lending rates hinder growth by making credit more expensive for consumers and investors.