The financial market reviewed down the expectations of inflation to 2025. According to the Focus report released on Monday (15) by the Central Bank, the Brazil will close the year with the broad consumer price index (IPCA, the country’s official inflation) at 4.83% – below, therefore, of the 4.85% projected a week ago.
Four weeks ago, the market worked with the forecast that 2025 would end with even higher inflation of 4.95%. For subsequent years, projections are 4.30% in 2026 and 3.90% in 2027.
The estimate for 2025 is above the ceiling of the inflation target that must 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 August, Brazil registered, for the first time since August 2024, negative inflation (deflation, when the average price is cheaper), of -0.11%, according to the Brazilian Institute of Statistical Geography (IBGE). With this, the projections of the financial market are closer to the upper ceiling (4.5%).
The electricity bill retreated 4.21% in the month, representing a negative impact of 0.17 percentage point (PP), figuring as the sub -item that more pulled inflation down. With this, the housing group retreated 0.90%. The retreat the price set was the higher for a month of August since the beginning of Plan Real, in 1994according to IBGE.
The Food and Beverage Group (-0.46%) fell for the third month in a row. Transport (-0.27%) also helped to leave the IPCA Negative IPCA. In these three months, foods accumulated a drop of -0.91%. Transport (-0.27%) also helped to leave the negative IPCA.
Exchange
The expectations of the financial market regarding the dollar price at the end of 2025 also retreated, from R $ 5.55 projected a week ago to R $ 5.50, according to the bulletin released today.
It is the fourth consecutive week, which reduces expectations of the exchange rate of the US currency. In part, this is explained by the economic measures that have been adopted by the government of Donald Trump. For 2026 and 2027, the projected quote is the same: R $ 5.60.
GDP and SELIC STABLE
Expectations related to Brutop Domestic Product (GDP, the sum of all wealth produced in the country) and the Basic Interest Rate (Selic) If they kept stable.
In the case of GDP, the market projects a growth of 2.16% in 2025 – the same projected a week ago. Four weeks ago, expectations were that the country’s economy would grow 2.21% in the year.
For 2026, GDP expectations are 1.80% – smaller, therefore, than the growth projected a week ago (1.85%); and four weeks ago (1.87%). For 2027, projected economic growth is 1.90% – above 1.88% designed a week ago; and 1.87% designed four weeks ago.
Basic rate
Regarding Selic, the projection is that it closes the year by 15%the same percentage that has been designed for 12 weeks. For the subsequent years, the Market projects a 12.38%Selic in 2026; and 10.50%in 2027.
To achieve the inflation target, the Central Bank uses the main instrument the basic interest rate – Selic – defined at 15% per year by the BC monetary policy committee (COPOM). With the retreat of inflation and the beginning of the deceleration of the economy, the collegiate interrupted the interest rate increase.
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.
Banks consider other factors other than Selic when defining the interest to be charged from consumers. These include the 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.
