São Paulo – The inflation forecast from financial market players polled by the Brazilian Central Bank changed down for the fifth week in a row. Inflation is expected to fall short of the monetary authority’s target range. The news was made public in the Central Bank’s Focus Bulletin, issued online weekly and covering key economic indicators.
The Central Bank strives to keep inflation in the 3%-6% range, the midpoint being 4.5%. In the 11 months through November, the Extended Consumer Price Index (IPCA) reached 2.5%, the lowest result for the period since 1.32% through November 1998. The projection for 2018 also moved down, from 4% to 3.96%.
To steer inflation toward desired levels, the Central Bank relies primarily on the benchmark interest rate – at 7%, it is currently at an all-time low. The Central Bank poll’s respondents see the Selic ending 2018 at 6.75% per annum, down from a prior 7% forecast.
Expected Gross Domestic Product (GDP) growth changed up from 0.96% to 0.98% regarding this year, and from 2.64% to 2.68% in 2018.
*Translated by Gabriel Pomerancblum
