The financial market raised its growth projection for the Brazilian economy for this year for the tenth consecutive time. According to the Focus bulletin released today (23) by the Central Bank (BC), the Gross Domestic Product (GDP) should close the year at 2.02%. A week ago, the projection was that the index would be at 1.95%.
Focus brings forecasts from economists and market analysts consulted by the BC. For 2025, the market predicts growth of 2%, the same as the last 19 weeks. Index that repeats in 2026 and 2027.
The bulletin indicates, on the other hand, an increase in inflation which, according to analysts, should close the year at 3.73%. A week ago, the forecast was that the Broad Consumer Price Index (IPCA) would be at 3.71%.
The estimate for 2024 is within the inflation target range that should be pursued by the BC. Defined by the National Monetary Council (CMN), the target is 3%, with a tolerance range of 1.5 percentage points up or down. In other words, the lower limit is 1.5% and the upper limit is 4.5%.
For 2025, the projection is that inflation will remain at 3.6% and, in 2026, it will close at 3.5%, the same for 2027.
In relation to the economy’s basic interest rates, the market projected a decrease in the rate of decline in the Selic rate. Analysts believe that the reference for interest rates in the country should remain at 9.5% this year. A week ago the forecast was 9.13% and four weeks ago the forecast was that the Selic would close the year at 9%.
In the last two meetings, the cut in the Selic was 0.5 percentage points. The BC’s Monetary Policy Committee (Copom) has already indicated that it may not repeat the same rate of cuts.
When Copom increases the basic interest rate, the purpose is to contain heated demand, and this has an impact on prices because higher interest rates make credit more expensive and encourage savings.
When the Copom reduces the Selic, the tendency is for credit to become cheaper, encouraging production and consumption, reducing control over inflation and stimulating economic activity.
For the financial market, Selic should end 2025, at 9%. The estimate for 2026 is that the basic rate will fall to 8.5% per year. The same forecast for 2027.
Exchange
The bulletin predicts an increase in the value of the exchange rate in dollars. According to Focus, in 2024, the currency will close the year at R$5.00. Four weeks ago, the forecast was that the North American currency would be at R$4.95.
For 2025, the projection is also for an increase in the dollar, which should remain at R$5.05. For 2026, the forecast is that the exchange rate will close at R$5.10.
