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BRAZIL: Selic Rate Decision Due At 2130GMT(1630ET)

BRAZIL
BulletEM BulletEmerging Market News
  • A reminder that the Copom is set to step up the hiking pace again today after the government’s recent fiscal package disappointed market expectations, leading to a weaker currency and a new spike of inflation expectations, which is likely to bring renewed inflationary pressures.
  • Analysts anticipate a 75bp hike to 12.00%, with risk of an even larger 100bp move if the central bank wishes to front-load the adjustment. Earlier this week, Goldman Sachs raised their Selic hike forecast to 100bp, from 75bp previously.
  • Following the recent headline that President Lula will go through another medical procedure, USDBRL has spiked lower, now down 1.4% on the day, while DI swap rates have rallied further, with yields down more than 30bp today.
  • The Copom’s guidance will be closely monitored later as analysts continue to increase their peak Selic rate forecasts for the cycle.
    • The full MNI preview with analyst views is here.
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  • A reminder that the Copom is set to step up the hiking pace again today after the government’s recent fiscal package disappointed market expectations, leading to a weaker currency and a new spike of inflation expectations, which is likely to bring renewed inflationary pressures.
  • Analysts anticipate a 75bp hike to 12.00%, with risk of an even larger 100bp move if the central bank wishes to front-load the adjustment. Earlier this week, Goldman Sachs raised their Selic hike forecast to 100bp, from 75bp previously.
  • Following the recent headline that President Lula will go through another medical procedure, USDBRL has spiked lower, now down 1.4% on the day, while DI swap rates have rallied further, with yields down more than 30bp today.
  • The Copom’s guidance will be closely monitored later as analysts continue to increase their peak Selic rate forecasts for the cycle.
    • The full MNI preview with analyst views is here.