A seller measures a consumer's temperature at the entrance of a store amid COVID-19 outbreak, in Sao Paulo, Brazil, on Aug. 5, 2020. (Photo by Rahel Patrasso/Xinhua)

 
The Monetary Policy Committee of Brazil's central bank (Copom) announced on Wednesday a cut of 0.25 percentage points to the benchmark interest rate, taking it to 2 percent annually.

The move, expected by analysts, marked the ninth consecutive reduction in the basic interest rate, and a return to Brazil's lowest rate.

According to the Copom, the economy continues to gradually recover from the economic crisis generated by the COVID-19 pandemic, with inflation remaining low due to weak consumption.

However, the committee cautioned that on the external front, the COVID-19 pandemic continues to cause the largest global economic crisis since the Great Depression.

"In this context, despite some promising signs of a resumption of activity in the major economies and some moderation in volatility of financial assets, the environment remains difficult for emerging economies," the committee said.

Regarding economic activity in Brazil, recent indicators had suggested only a partial recovery, since the sectors most affected by social distancing remain depressed, despite the increase in income generated by government programs.