Economists have increased the interest rate forecast while maintaining the inflation projection for this year, according to the first Focus bulletin that considers the conflict in the Middle East.
In the latest Focus bulletin, Brazilian economists have raised their forecast for the Selic interest rate to 12.13%, reflecting an increase of 0.13 percentage points from the previous bulletin. This revision comes in light of the recent conflict in the Middle East, particularly the military actions involving the U.S. and Israel against Iran which occurred on February 28. The uptick in the interest rate marks a reversal after two weeks of declines. Typically, higher interest rates are intended to control inflation, yet the inflation forecast has not changed.
