Brazil Cuts Interest Rate

Brazil’s central bank cut its benchmark lending rate a quarter-percentage point to 19.5% from a two-year high as inflation slows. The semi-independent bank began raising interest rates 17 months ago, slowing growth to a forecast 3.4% this year from 4.9% in 2004. The currency gained 25% in the past 12 months and inflation has fallen to 6%. The central bank’s inflation target is 5.1% this year and 4.5% in 2006.