Brazil's central bank on Wednesday held its benchmark interest rate at 14.25 percent for a seventh consecutive time, amid the worst recession in decades and political instability. 

The bank, which makes rate decisions eight times a year, has held its key Selic rate steady since the last of seven consecutive hikes in July 2015.

Despite the flailing economy -- with a 3.8 percent shrink in GDP last year forecast to persist through 2016 -- the latest consensus of 100 economists and analysts in a weekly survey by the Central Bank's Focus magazine was for no change in the key rate.

Latin America's biggest economy has been in recession since the second quarter of 2015. The three main credit rating agencies have lowered their Brazil rating to junk status.

Managing the flailing economy, where inflation last month crept up to a rate of 9.32 percent, is one of the biggest challenges facing the central bank governor Ilan Goldfajn, appointed by the country's new interim president Michel Temer.

Goldfajn has said reining in spiraling prices will be his top priority.

The central bank has a inflation ceiling target of 6.5 percent.