Central Bank report shows that inflation will end the year above the target ceiling; Selic should rise up to 12% in 2025
Financial market agents increased the estimate for Brazil’s inflation in 2024 from 4.62% to 4.64%, measured by the IPCA (Broad National Consumer Price Index). It also raised the projection for 2025 from 4.10% to 4.12%.
The estimates are in the Focus Bulletin, a report released weekly by the (Central Bank) with the expectations of financial agents. The document was released this Monday (Nov. 18, 2024). Here is the presentation (PDF – 772 kB).
Brazil’s inflation target is 3%, with a tolerance range of 1.5 percentage points up and down: from 1.5% to 4.5%. When the accumulated rate over 12 months remains above 4.5% for more than 6 months, the Central Bank has failed to comply with the rule.
According to IBGE (Brazilian Institute of Geography and Statistics), inflation in Brazil was . It was the 1st month that it was above the target ceiling.
Financial market agents maintained their projection for this year’s basic rate, the Selic, at 11.75% per year. The base interest. That of the Copom (Monetary Policy Committee) on December 10th and 11th of this year. For 2025, estimates for Selic rose from 11.50% to 12.00%.
Financial agents increased the median projections for the dollar exchange rate at the end of 2024 from R$5.55 to R$5.60. For 2025, it increased from R$5.48 to R$5.50.
Projections for GDP (Gross Domestic Product) growth have not changed: 3.10% in 2024 and 1.94% in 2025.
