Focus Bulletin: market reduces inflation forecast for the year – 01/30/2024 – Market

Economists interviewed by the Central Bank reduced their inflation forecast for this year in Brazil for the third consecutive week.

According to the Focus bulletin, released this Tuesday (30), the market expectation is that the IPCA (Broad National Consumer Price Index) will end 2024 at 3.81%, a drop of 0.05 percentage points compared to the week last year, when the forecast was 3.86%.

In the first week of the year, economists pointed out that the index would be at 3.90%. For the next three years, the forecast was maintained at 3.5%, as has been the case for almost seven months. This year’s IPCA projection remains above the center of the official target, which is 3%, but below the ceiling, of 4.5%.

This was the only change among the main indices highlighted in the Focus bulletin. Analysts maintained GDP at 1.6% for 2024 and 2% in 2025, 2026 and 2027. The dollar remains at R$4.92 this year, R$5 (2025), R$5.05 (2026) and R$ 5.10 (2027).

The Selic basic interest rate also remains at 9% in 2024 and 8.5% in the following three years.

Starting this Tuesday, the Central Bank’s Copom (Monetary Policy Committee) meets to define the new rate, which is currently 11.75%. The expectation is that there will be a cut of 0.5 percentage points, reaching 11.25%. The announcement will be this Wednesday (31).

The Focus bulletin is usually released on Monday, but was postponed by one day due to the protest by BC employees, who are asking for career improvements, hiring of more employees, salary adjustment, remuneration for productivity, requirement for higher education for the technical position and other requests.

According to the union, the Central Bank has not held a competition for over ten years and currently has 44% of vacant positions out of a total of 6,470.