Focus Bulletin records 13th consecutive fall week in the forecast for the 2025 IPCA; However, number follows above the central bank goal
The forecast of the financial market for the – Considered the country’s official inflation – went from 4.95% to 4.86% this year. It is the thirteenth reduction followed in the estimate, published in the This Monday (25), in Brasilia. The survey is released weekly by the Central Bank (BC) with the expectation of financial institutions for the main economic indicators. For 2026, the projection of inflation also fell from 4.4% to 4.33%. For 2027 and 2028, forecasts are 3.97% and 3.8%, respectively.
Above the ceiling
The estimate for this year is above the ceiling of the inflation target that should be pursued by the BC. Defined by the National Monetary Council (CMN), the goal is 3%, with a tolerance interval of 1.5 percentage up or down. That is, the lower limit is 1.5% and the upper 4.5%. In July, pressured by the most expensive energy bill, the official inflation released by the Brazilian Institute of Geography and Statistics (IBGE) closed at 0.26%, being the second month followed by falling food prices, which helped hold the index. Accumulated in 12 months, the IPCA reached 5.23%, above the target ceiling of up to 4.5%.
Basic interest
To achieve the inflation target, the The main instrument uses the basic interest rate – Selic – defined at 15% per year by the BC Monetary Policy Committee (COPOM). The retreat of inflation and the beginning of the economy’s slowdown made the board interrupted the interest rate increase at the last meeting last month after seven highs in Selic. In a statement, Copom reported that US commercial policy has increased uncertainties over prices. The monetary authority reported that, for now, it intends to maintain basic interest rates, but has not ruled out the possibility of raising Selic again if necessary.
Analysts estimate is that the basic rate will close 2025 by 15% per year. For the end of 2026, Selic is expected to fall to 12.5% per year. For 2027 and 2028, it is expected to be reduced again to 10.5% per year and 10% per year, respectively. When the copom increases the basic interest rate, the purpose is to contain heated demand, and this causes reflexes in prices because higher interest rates make credit more expensive and stimulate savings. But in addition to Selic, banks consider other factors when defining consumer interest, such as risk of default, profit and administrative expenses.
Thus, higher rates can also make it difficult to expand the economy. When the Selic rate is reduced the tendency is that credit is cheaper, with incentive to production and consumption, reducing control over inflation and stimulating economic activity.
GDP and exchange
The estimate of financial institutions for the growth of the Brazilian economy this year went from 2.21% to 2.18% in this edition of the Focus Bulletin. For 2026, the projection for Gross Domestic Product (GDP, the sum of goods and services produced in the country) was 1.86%. For 2027 and 2028, the financial market estimates GDP expansion by 1.87% and 2%, respectively.
Pulled by agriculture in the first quarter of this year, the Brazilian economy grew 1.4%. By 2024, GDP closed with a 1.4%increase. The result represents the fourth year in a row in growth, with the highest expansion since 2021, when GDP reached 4.8%. The forecast of the dollar quotation is $ 5.59 for the end of this year. At the end of 2026, it is estimated that the US currency is $ 5.64.
*With information from Agência Brasil
