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Itaú Now Forecast 2023 Year-End Selic Rate At 12.5%, Prior 11%

BRAZIL
  • ITAU SEES BRAZIL RATE AT 12.5% BY END 2023, PRIOR 11% (BBG)
  • Itaú had mentioned that the December 2022 Inflation Report shows forecasts that are still consistent, in their view, with the Selic rate remaining at the current level of 13.75% p.a. for an extended period.
  • Their baseline scenario contemplated interest rate cuts starting in August 2023, however, the recent increase in fiscal uncertainty – and the warnings given by the monetary authority on the subject – suggest a significant risk that an easing cycle might take longer to start.

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