Brazil took steps to boost lending by as much as 150 billionreais (US$66 billion) as it strives to quicken growth withoutstoking inflation before presidential elections in October.

Policy makers reduced capital requirements for banks by 15billion reais, a move that could generate as much as 140 billionreais in loans, according to central bank official Caio Ferreira.They also created incentives for banks to channel as much as 10billion reais from reserves requirements into lending.

Today's moves are similar to measures taken July 25 thatdrew criticism from analysts who were surprised by efforts to boostcredit a week after policy makers kept interest rates unchanged atthe highest level in more than two years. Central bank PresidentAlexandre Tombini said earlier this month that controllinginflation with higher borrowing costs isn't at odds with measuresto free up credit.