Itaú BBA - Inflation Report: Forecasts point to stable Selic rate in 2019

Macro Brazil

< Volver

Inflation Report: Forecasts point to stable Selic rate in 2019

diciembre 20, 2018

Central Bank's forecasts are consistent with stable Selic rate at the current level of 6.5% pa throughout 2019

For the version with all charts and tables, please open the attached pdf file 
 

The inflation report of December 2018 shows forecasts which are consistent with stable Selic rate at the current level of 6.5% pa throughout 2019, at least, barring new shocks. Indeed, in the reference scenario, with constant Selic rate and constant exchange rate, inflation forecasts are 4.0% for 2019, 4.0% for 2020 and 4.1% for 2021 (compared to the targets of 4.25% for 2019, 4.00% for 2020 and 3.75% for 2021), showing the need for rate hikes only in 2020. We see the report as fully consistent with our own forecast of stable Selic rate in 2019 and policy normalization starting only sometime in 2020.
 

For the version with all charts and tables, please open the attached pdf file 



< Volver