BRASILIA, May 18 (Xinhua) -- Brazil's financial market raised its forecast for the benchmark Selic interest rate to 13.25 percent for 2026, up from 13 percent previously, while maintaining its forecast for 2027 at 11.25 percent, the Central Bank of Brazil said Monday.
According to the bank's weekly Focus survey of analysts at the country's leading financial institutions, the upward adjustment in the projected interest rate, currently at 14.50 percent annually, was made amid worsening inflation projections, which rose for the 10th consecutive week due to the conflict in the Middle East.
Analysts slightly raised their forecast for Brazil's inflation rate at the end of 2026 to 4.92 percent from 4.91 percent, while keeping the 2027 projection unchanged at 4 percent.
Target inflation for 2026 is 3 percent, with a tolerance margin of 1.5 percentage points higher or lower.
Market analysts maintained their forecast for Brazil's economic growth at 1.85 percent for 2026, but slightly inched up the 2027 estimate from 1.76 percent to 1.77 percent.
In the currency market, the Brazilian real is currently trading at an average of 5.06 to the U.S. dollar. Forecasters expect it to weaken to 5.20 by the end of 2026 and 5.27 by the end of 2027.
The trade balance is projected to see a surplus of 75.53 billion U.S. dollars in 2026 and 75 billion dollars next year.
Foreign direct investment in Brazil should reach 75 billion dollars in 2026 and 77.8 billion dollars in 2027, analysts said. Enditem
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