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
Brazil Interest Rate Data
2018 | 2019 | 2020 | 2021 | 2022 | |
---|---|---|---|---|---|
SELIC Rate (%, eop) | 6.50 | 4.50 | 2.00 | 9.25 | 13.75 |
10-Year Bond Yield (%, eop) | 9.23 | 6.78 | 6.90 | 10.83 | 12.66 |
Bank delivers fifth 50 basis point cut in January
At its first scheduled meeting of the year on 30–31 January, the Monetary Policy Committee (COPOM) of the Central Bank of Brazil (BCB) continued its loosening cycle, slashing the benchmark SELIC rate by an additional 50 basis points to 11.25%. The move was the fifth consecutive half-percentage-point reduction. The decision was once again unanimous and had been priced in by markets as the BCB followed the path it announced at its prior meeting.
The cut was driven by the continued disinflation process. Moreover, the Bank noted that the ongoing loosening cycle is consistent with its objective of bringing inflation to an acceptable level “over the relevant horizon, which includes the years 2024 and 2025”, as the policy stance remains restrictive. In particular, the BCB’s baseline inflation expectations for 2024 and 2025 were unchanged from December at 3.5% and 3.2%, respectively. Consequently, it forecasts inflation will overshoot the 3.0% target but fall within the 1.0–5.0% tolerance band.
The communiqué’s forward guidance stated that, if the Bank’s baseline scenario materializes, it would cut interest rates by another 50 basis points when it convenes next on 19–20 March. That said, it reiterated that risks to the inflation outlook remain two-sided. Consequently, the policy stance will remain restrictive, and the magnitude of cuts may vary until the disinflation trend is consolidated and inflation expectations are fully anchored at the target. All of our panelists see further interest rate cuts this year, although there is a wide forecast spread: Between 125–425 basis points of further reductions are expected.
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 35 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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