From The Reformed Broker:

What is Brazil seeing that we're not aware of? If you're not pondering that this morning, you may want to turn your investments over to someone else – yes, it is that important of a development...

From the WSJ:

SÃO PAULO, Brazil—Brazil slashed its overnight lending rate in a surprise move Wednesday that is likely to spur questions about the government's commitment to fighting inflation – as well as the independence of its central bank.

Brazil's central bank cut the overnight rate by half a percentage point to 12%, still among the highest rates in the world. In a statement, the central bank said weakening economies in the U.S. and Europe would take pressure off Brazilian inflation, reducing the need for its high rates.

There's also talk that the cuts come at a time where the Brazilian Real currency is pressuring local manufacturers. (It is up almost 50% since 2009.) I'm not sure that I believe this was the only or even primary reason for a cut.

I also don't believe that this cut has anything to do with U.S. or European deflation taking pressure off prices. I think it has more to do with...

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