Latest bank decision: At its meeting on 19 February, the Central Bank agreed to lower the Official Cash Rate (OCR)...
SELIC Rate in Brazil
Brazil's central bank policy rates fluctuated significantly from 2013 to 2022, mirroring the country's economic challenges. Rates were initially high due to inflation concerns but were cut to historic lows to stimulate growth. However, post-2020, rates were again increased in response to rising inflation and economic recovery needs. This pattern reflected Brazil's ongoing struggle to balance inflation control with economic growth.
The SELIC Rate ended 2022 at 13.75%, up from the 9.25% end-2021 value and up from the reading of 10.00% a decade earlier. For reference, the average policy rate in Latin America was 18.90% at end-2022. For more interest rate information, visit our dedicated page.
Brazil Interest Rate Chart
Note: This chart displays Policy Interest Rate (%) for Brazil from 2014 to 2024.
Source: Macrobond.
Brazil Interest Rate Data
| 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|
| SELIC Rate (%, eop) | 2.00 | 9.25 | 13.75 | 11.75 | 12.25 |
| 10-Year Bond Yield (%, eop) | 6.90 | 10.83 | 12.66 | 10.36 | 15.21 |
Central Bank sticks to its forward guidance and hikes rates in January
New Central Bank governor sticks to previously agreed forward guidance: At its meeting on 28–29 January, the Monetary Policy Committee (COPOM) of the Central Bank of Brazil (BCB) increased its SELIC rate by another 100 basis points to 13.25%. The rise was unanimous and had been priced in by markets, as the BCB stuck to its forward guidance from its December meeting. The decision, which brought the cumulative increases to 275 basis points since September 2024, was the first under the new Central Bank Governor Gabriel Muricca GalĂpolo.
Inflation outlook deteriorates further: The decision to raise interest rates further was due to persistently above-target headline and core inflation. Moreover, the BCB assessed that risks to the inflationary outlook remain skewed to the upside and that inflation expectations deanchored further recently. Stemming from this, the BCB hiked its 2025 inflation forecasts by 0.7 percentage points to 5.2%, well above its 1.5–4.5% tolerance band. Additionally, domestic economic activity and the labor market continue to show resilience, deeming a more contractionary monetary policy necessary to cool down the economy.
Aggressive rate hikes to continue in Q1: The Central Bank’s forward guidance indicated another rate increase of the same magnitude at its next meeting on 18–19 March, a view shared by all of our panelists. Our Consensus is for the Central Bank to continue hiking the SELIC rate in Q2, before then slightly reducing it by the end of the year. The government’s fiscal policy remains a key factor to monitor due to its effect on domestic demand.
Consensus Forecasts and Projections for the next ten years
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Brazilian interest rate projections for the next ten years from a panel of 30 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for Brazilian interest rate.
Download one of our sample reports to visualize what a Consensus Forecast is and see our Brazilian interest rate projections.
Want to get access to the full dataset of Brazilian interest rate forecasts? Send an email to info@focus-economics.com.
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