Brazil: market projects 11th consecutive inflation hike for 2023

For the 11th consecutive week, market analysts are projecting higher inflation for 2023.

In the Focus Bulletin released this Monday, 27, by the Central Bank, the projection is for inflation to close the year at 5.9%.

Last week, the projection was 5.89%, and four weeks ago, 5.74%.

For 2024, the projection this week remained the same as last week, of 4.02%.

As for inflation in 2025 and 2026, the analysts projected a new high in relation to last week. In 2025, it went from 3.78% to 3.8%, and in 2026, it went from 3.7% to 3.75%.

The bulletin also projects growth in the Gross Domestic Product (GDP) in 2023 for the second consecutive week.

This Monday, the projection is for growth of 0.84%, down from 0.8% last week.

For the ninth consecutive week, analysts are projecting stability for the 2024 GDP, with a growth rate of 1.5%. For 2025 and 2026, the indexes remained stable in relation to the previous week, at 1.8% and 2%.

As for the basic interest rate, analysts maintained the projection that in 2023 the Selic would close at 12.75%.

Today the basic interest rates are at 13.75%.

For 2024, the projection is 10%, the same as last week, and for 2025, 9%,  also repeated.

For 2026, analysts project a drop to 8.5%, down from 8.75% last week.

For the fourth consecutive week, the exchange rate is projected to close 2023 with the dollar at R$5.25.

Published every Monday, the Focus Bulletin summarizes statistics calculated considering market expectations collected until the Friday before its release.

The report shows the graphical evolution and the weekly behavior of projections for price indexes, economic activity, foreign exchange, and the Selic rate, among other indicators.

The projections are from the market, not from the Central Bank.

With information from Revista Oeste