08/19/2024 – 12:15
By Fernando Cardoso
SAO PAULO (Reuters) – Analysts consulted by the Central Bank raised their projection for the Selic rate at the end of next year, while again maintaining their expectation for the basic interest rate in 2024, according to the most recent Focus survey released on Monday.
The survey, which captures market perceptions of economic indicators, showed that economists now see the Selic rate closing 2025 at 10.00% per year, compared to 9.75% the previous week.
For the ninth consecutive week, on the other hand, they maintained their expectation for the interest rate at the end of this year at the current level of 10.50%, therefore projecting that the BC will not make any moves in the remaining monetary policy meetings in 2024.
Analysts’ estimates come after a series of events with central bank authorities last week, including the agency’s president, Roberto Campos Neto, and the director of monetary policy, Gabriel Galípolo, who conveyed the message that it is possible to raise interest rates this year if appropriate to control inflation.
At the beginning of the month, data from IBGE showed that July inflation over 12 months reached the ceiling of the BC’s target at 4.50%.
The official inflation target is 3.00%, always with a tolerance margin of 1.5 percentage points either way.
Inflation expectations for this year and next, another cause for concern for the agency’s members, also remain far from the center of the target.
In Monday’s survey, economists raised their projection for the IPCA increase by the end of 2024, now at 4.22%, from 4.20% a week ago. In 2025, the index is seen with an increase of 3.91%, a decline from the 3.97% previously forecast.
The weekly survey of a hundred economists also showed that expectations for GDP growth this year rose to 2.23%, compared to 2.20% the previous week. Next year, the country should see growth of 1.89%, according to analysts, up from 1.92% previously.
The forecast for the value of the dollar remained close to stability for 2024, now seen at 5.31 reais, from 5.30 reais a week ago. For 2025, the projection of 5.30 reais was maintained.
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