RIO DE JANEIRO, BRAZIL – Experts began to see inflation at the ceiling of the target in 2022, in a scenario of still worsening expectations for growth, according to the Focus survey released by the Brazilian Central Bank on Monday.
The survey conducted with a hundred economists shows that the projection for the rise in the IPCA inflation index this year and next year continued to rise.
For 2021, the forecast increased for the 34th consecutive week to 10.15%, from 10.12% before, well above the original Central Bank target of 3.75% with a tolerance margin of 1.5 percentage points more or less.
For 2022 the forecast increased by 0.04 percentage points and reached 5.0%, the ceiling of the target, since it will be 3.5% next year, also with a margin of 1.5 percentage points. It was the 19th time in a row that the projection increased.
The continuous deterioration in the inflation outlook comes amid increasingly weaker projections for the economy. According to the weekly survey, the Gross Domestic Product (GDP) should grow 4.78% this year and 0.58% next year, from 4.80% and 0.70% expected earlier.
The weekly survey with a hundred economists also showed that the basic interest rate should be raised by 1.5 percentage points in the December meeting of the Central Bank and end this year at 9.25%. But the Selic, currently at 7.75%, is still predicted to reach the end of 2022 at 11.25%, unchanged from the prior week projections.