Brazil Economists Lift Selic View to 13.5% as Lula Reelection Fuels Market Selloff
Updated
Updated · Bloomberg · Nov 3
Brazil Economists Lift Selic View to 13.5% as Lula Reelection Fuels Market Selloff
3 articles · Updated · Bloomberg · Nov 3
Summary
Brazil’s weekly central bank survey now sees the benchmark Selic reaching 13.5% in December, up from 13.25%, after Luiz Inácio Lula da Silva’s reelection triggered a market rout.
That repricing extended through 2029: economists lifted the end-2027 Selic forecast to 12.5% from 11.75%, raised 2028 by a full point to 11%, and nudged 2029 to 10.25%.
Inflation expectations also moved higher in the first post-election Focus survey, with end-2027 inflation seen at 4.76% versus 4.34% previously, alongside a weaker real.
The shift darkens prospects for cheaper credit and leaves Brazil’s central bank balancing renewed inflation pressure against already high borrowing costs.