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If the bank's nine-member policy board approved a rate increase, the benchmark overnight loan rate would probably rise from near zero to 0.25percentt, analysts said.
The data is the last major economic report before the Federal Reserve decides whether to increase the benchmark interest rate later this month.
The rate has fallen for three straight months, prompting economists to forecast that the Bank of England may increase the benchmark interest rate from its 38-year low of 4percentt as early as next month to head off an increase in inflation.
However, the Central Bank's decision yesterday to increase the benchmark Selic rate by a further 50 basis points, to 18.8%, will have repercussions on the rhythm of sustained growth needed for debt sustainability.
The authors should look to increase the benchmark size or show that that the current benchmark is statistically representative.
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While inflation remains below the central bank's target of about 2 percent, the uptick is likely to provide a further argument against increasing the benchmark interest rate.
The governor of the Reserve Bank of India, Duvvuri Subbarao, increased the benchmark reverse repurchase rate to 3.5 percent from a record low of 3.25 percent and raised the repurchase rate to 5 percent from 4.75 percent, according to a statement in Mumbai.
Gagnon said he believes the Fed wants to begin increasing the benchmark rate before the economy reaches the inflation target to ensure the transition is gradual. .
U.S. home prices began their sharp rise in the late 1990s, a time when the Fed was increasing the benchmark rate, they point out.
Increasing the benchmark rate will probably raise the cost of borrowing for Americans with outstanding loans, whether they are homeowners or operators of small businesses.
They increased the benchmark federal funds rate by 0.25 percentage point in December after keeping it near zero for seven years in an attempt to boost the recovery.
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