Brazil market expects 2026 inflation at 5.02 percent

The Banco Central do Brasil's Focus Market Readout for August 14, 2026, shows that economic analysts maintained their median expectation for 2026 IPCA inflation at 5.02 percent, unchanged from the prior week.

Projections for the benchmark Selic interest rate also held firm at 13.75 percent for year-end 2026.

For 2027, survey respondents revised their inflation outlook slightly upward from 4.22 percent to 4.24 percent, while keeping the Selic target forecast steady at 12.00 percent.

The expected smoothed IPCA inflation rate over the next 12 months rose from 4.24 percent to 4.32 percent, signaling persistent medium-term price pressures despite stable near-term baseline forecasts.

Gross domestic product growth expectations for 2026 remained unchanged at 1.98 percent, but analysts trimmed the 2027 growth outlook from 1.52 percent to 1.50 percent, and the 2028 outlook to 1.89 percent.

Meanwhile, external sector metrics improved, with the 2026 trade surplus projection rising from US$ 76.90 billion to US$ 77.90 billion.

The exchange rate expectation for year-end 2026 stayed at R$/US$ 5.20, while the 2027 rate was adjusted slightly upward to R$/US$ 5.29.