Outstanding loans in Brazil kept growing in August, according to the latest central bank data, with credit showing robustness despite rising costs amid an aggressive monetary tightening.

Outstanding loans were up 1.6% in August from the month before to R$ 5.067 trillion.

In July, outstanding loans rose 0.6%, a figure that had not yet been released by the central bank, which is still normalizing its data after a strike by its employees earlier this year.

Year-to-date growth reached 8.4% and, in 12 months through August, outstanding loans jumped 16.8%, driven mainly by the rise in credit to individuals, the central bank said.

This has occurred despite policymakers’ strong monetary tightening to curb inflation, which has put the benchmark interest at 13.75% from a 2% record low in March 2021.

In a rate-setting meeting in the end of september, the central bank paused its tightening cycle but stressed hikes could be resumed if disinflation does not happen as expected.

In August, bank lending spreads rose to 28.3 percentage points from 27.5 points in July, to the highest level since February 2020.

A broad measure of Brazilian consumer and business default ratios increased to 3.9% from 3.8% the month before.

Original Story: Nasdaq |Marcela Ayres/ Reuters
 Edition: Prime Yield