Focus: Market passed to see inflation of 5.71% in 2023 – 05/29/2023 – Market

Analysts consulted by BC (Central Bank) again reduced their expectations for inflation in 2023 after signs of relief in price increases, at the same time that they began to see better performance of the economy.

The survey, which captures the market’s perception of economic indicators, pointed out that the expectation for the IPCA rise in 2023 is now 5.71%, against 5.80% in the previous week.

This revision comes on the heels of data last week that showed the IPCA-15 rose less than expected in May, 0.51%, with the 12-month rate retreating to the lowest level in about two and a half years, from 4.07%.

For 2024, the projection for rising prices remained at 4.13%, and for the next two years, it remains at 4.0%.

The center of the official target for inflation in 2023 is 3.25% and for 2024 and 2025 it is 3.00%, always with a tolerance margin of 1.5 percentage points, more or less.

The result of the IPCA-15 raised bets of an anticipation of cuts in the Selic by the Central Bank, but the weekly survey with a hundred economists also showed that they continue to see maintenance of the basic interest rate at the current level of 13.75% at the meeting of June.

Focus also shows that there were no changes in the scenario for the Selic at the end of this year and next, with the rate calculated at 12.50% and 10.00% respectively.

BC president Roberto Campos Neto assessed that the disinflation process in Brazil is not over yet and that it is necessary to converge inflation to the target.

For the GDP (Gross Domestic Product), the growth estimate in 2023 improved by 0.06 percentage points, to 1.26%, while, for 2024, it remained at 1.30%.