Brazilian inflation is currently
running at 6.59%, which is above the ceiling of the country's 2.5%-to-6.5%
target inflation range. The 12-month inflation rate has been creeping higher
since the beginning of the year, led by stubborn food and fuel prices.
Inflation ended 2012 at 5.84%.
Brazil's economy expanded by just
0.9% in 2012 after disappointing growth of 2.7% the previous year. Most
economists are forecasting growth of about 3.0% in 2013, but only if exports
pick up and both consumer and business confidence remain firm.
On April 17th , the
central bank's monetary policy committee voted to raise its SELIC base interest
rate a quarter point to 7.5%. Six members voted for the increase while two cast
ballots for keeping the rate stable. Central bank to remain cautious in
coming decisions, Bank says monetary policy to be "especially
vigilant", Bank director comments raise possibility of steeper hikes.
How a Base Rate will boost Forex trading?
Interest rates directly influence
the demand for currencies in two ways. Firstly, they provide an actual demand
for the currency in the knowledge that the worlds largest investors, such as
countries and banks, will look for the highest rate of return on their
investment with the lowest risk. Interest rates therefore determine how
attractive a currency appears to these investors and by increasing or
decreasing the base rate of interest this can be achieved. In the same way as
holding money in a regular bank account these investors need to purchase the
currency in order to gain the preferential interest rate. Therefore, raising
the base rate even only very fractionally results in an increase in demand for
that currency which is instantly reflected in the value between forex pairs.
HSBC’s new ad campaign
The new lemon ads Lemonade and Lemon Grove is about to bring some boost for HSBC.The video starts with the
all-American summer image of a kid earning some pocket money from her home-made
lemonade stand. Suddenly trouble arises when her latest customer doesn’t have
any American change. Not to worry, turns out not only does our littelest
businesswoman cover all major currencies, she also speaks Cantonese. Cue a bus
full of new customers and an emerging local lemonade monopoly for international
customers.
The new ads shown by HSBC where a
little girl setting up a multinational lemonade stands by accepting different
foreign currencies. The track is a specially recorded cover version by the
Soundtree music production company of Thank Heaven for Little Girls, which was
originally recorded by Maurice Chevalier for the 1958 movie Gigi.
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