Brazilian market forecasts show rising inflation and Selic rate

Market analysts surveyed by the Banco Central do Brasil (BCB) have revised their inflation expectations upwards for 2026.

The median forecast for the Broad National Consumer Price Index (IPCA) for the current year rose to 4.31 percent, up from 4.17 percent a week ago and 3.91 percent four weeks prior.

This upward trend, marked by three consecutive weeks of increases, signals persistent price pressures.

Concurrently, expectations for the benchmark Selic target rate for 2026 have also seen an upward adjustment, stabilizing at 12.50 percent.

This is an increase from 12.00 percent four weeks ago, reflecting a consistent view among respondents over the past week.

Other key indicators show more stability, with GDP growth for 2026 marginally increasing to 1.85 percent and the exchange rate holding steady at 5.40 R$/US$.

Beyond 2026, inflation expectations for 2027 and 2028 show minor upward adjustments, reaching 3.84 percent and 3.57 percent respectively.

The Selic target rate forecasts for 2027 and 2028 remain stable at 10.50 percent and 10.00 percent, with a slight increase to 9.75 percent for 2029.

Other key economic projections for 2026 indicate a narrowing current account deficit to -65.00 billion US dollars and a stable trade balance surplus of 70.00 billion US dollars.

Net public sector debt and primary fiscal results show relative stability with minor weekly fluctuations.