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06/11/2017 - 12:33hs

Inflation forecast from banks flat

Financial market players expect prices to have gone up 3.08% by the end of this year. They also see GDP climbing 0.73%.

Brasília – The results of a weekly Brazilian Central Bank poll of financial market players’ expectations regarding key economic indicators, remained the same this week as in the last one. The monetary authority’s Focus Bulletin shows the Extended National Consumer Price Index (IPCA) is seen ending the year at 3.08%.

The 2018 IPCA forecast has remained at 4.02% for four weeks now. Both the 2017 and 2018 expected inflation numbers are lower than 4.50%, the midpoint of the Central Bank’s 3%-to-6% target range.

The Bank’s principal tool in chasing its target, the benchmark interest rate (known as the Selic rate) is now 7.5% per annum. The poll’s respondents expect the Selic to end both 2017 and 2018 at 7% per annum.

The Gross Domestic Product (GDP) is seen widening by 0.73% this year and by 2.5% in 2018. Both forecasts are the same as in last week’s poll.

*Translated by Gabriel Pomerancblum

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