Brazil’s Swaps Tumble as Central Bank Said to Consider Selic Cut

Brazilian swap rates, a measure of traders’ expectations of future borrowing costs, declined to a five-month low on speculation the central bank is considering an interest-rate cut to spur a rebound of Latin America’s largest economy.

Contracts maturing in January 2017 erased an earlier increase as a member of President Dilma Rousseff’s economic team, who asked not to be named, said policy makers see the possibility of cutting the Selic as early as this year amid the deepest recession in a century. While the real trimmed its 2016 slide on Monday, it’s still the worst performing among the world’s major currencies in the past 12 months.

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