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Brazil | Economic Analysis

See here the Macro Brazil, Scenario Review and Macro Vision reports

Macro Brazil

  • Service sector | August 14, 2025

    Despite the positive headline surprise, most components declined at the margin, reinforcing our view of a slowdown in economic activity during the second quarter of 2025.

  • Retail sales | July 8, 2025

    Broad Retail Sales fell 1.7% qoq s.a. in 2Q25.

  • July IDAT-Activity Report | August 12, 2025

    The result reflects a 1.5% decline in IDAT-Services and a 1.6% drop in IDAT-Goods.

  • IPCA | August 12, 2025

    Today’s data came in better than expected, both in the headline and in the qualitative components.

  • IDAT-Employment and Wage | August 11, 2025

    Despite the slowdown, the indicator still suggests that the unemployment rate should remain at historically low levels in the coming months, with no signs of a turning point.

  • Trade Balance | August 6, 2025

    There was an acceleration in exports of certain products to the United States, such as iron/steel and aircraft, suggesting some anticipation of the tariff hikes that took effect in August.

  • FX market | August 6, 2025

    In July, there was a significant increase in inflows in the commercial segment, but the financial sector continued to record large outflows.

  • IDAT-cars | August 5, 2025

    Prices for new and used cars increased, while low-mileage vehicles declined.

  • Copom Minutes | August 5, 2025

    We continue to project the Copom to leave the Selic unchanged at 15% until year-end, and to begin a modest easing cycle by 1Q26.

  • Industrial production | August 1, 2025

    Industrial production increased 0.1% qoq s.a. in 2Q25

  • Fiscal | July 31, 2025

    Primary deficit of BRL47.1bn in June

  • Unemployment rate | July 31, 2025

    Unemployment rate fell to 5.8% s.a. in June

  • COPOM | July 30, 2025

    The Copom decided, as anticipated, to leave the policy rate unchanged at 15% pa, where it should stay for quite some time.

  • Credit | July 28, 2025

    Corporate loans receded 7.2%, impacted by the increase in the Tax on Financial Operations.

  • Copom Cockpit | July 25, 2025

    We expect the Copom to unanimously maintain the Selic rate at 15.00%, reinforcing the strategy of maintaining it at a contractionary level for a prolonged period.

  • Current Account | July 25, 2025

    Profits and dividends lead the negative surprise in the current account in June.

  • IPCA-15 | July 25, 2025

    Underlying services inflation came in above expectations, led by food away from home.

  • Service sector | July 11, 2025

    Today’s data reinforces our view of a slowdown in economic activity during the second quarter.

  • IPCA | July 10, 2025

    IPCA moved up 0.24% in June

  • FX market | July 4, 2025

    There was a slowdown in trade inflows (driven by weaker export flows and stronger import flows), while financial outflows remained strong.

  • June IDAT-Activity Report | July 8, 2025

    This result reflected a 1.4% drop in the IDAT-Services index, while the IDAT-Goods index remained stable during the period.

  • Retail sales | July 8, 2025

    Today’s figures reinforce signs of a slowdown in economic activity.

  • Trade Balance | July 4, 2025

    We continue to expect the trade balance to recover ahead with the slowdown in domestic activity in the second half of this year.

  • IDAT-Employment and Wage | July 4, 2025

    June IDAT-Employment shows, once again, resilience in formal employment.

  • IDAT-cars | July 2, 2025

    New car prices rebounded, reversing the previous month decline.

  • Industrial production | July 7, 2025

    Industry appears to be losing momentum in the second quarter, and this trend is likely to persist in the coming months.

  • Fiscal | June 30, 2025

    General government gross debt rose to 76.1% of GDP in May from 76.0% of GDP in April.

  • Unemployment rate | June 27, 2025

    The data released today once again indicate a resilient labor market.

  • Credit | June 27, 2025

    Private payroll-backed loans dropped by 48%, offsetting part of the 109.3% increase recorded in April.

  • Monetary Policy Report | June 26, 2025

    The report reinforce the message from the latest policy meeting.

Brazil Scenario Review

  • Scenario | August, 2025

    Amid a weaker USD globally and higher interest rates in Brazil, we changed our FX forecasts to BRL 5.50/USD for 2025 and 2026, from 5.65.

  • Scenario | July, 2025

    The tariffs announced by the U.S. should hinder the improvement of the BRL observed in the year.

  • Scenario | June, 2025

    Given that inflation remains above target, expectations are unanchored, and economic activity is resilient, we see no room for rate cuts in 2025.

  • Scenario | May, 2025

    We now expect the Selic rate to remain stable at 14.75% pa until the end of the year.

  • Scenario | April, 2025

    The BRL has responded primarily to international factors, particularly shifts in global risk aversion.

  • Scenario | March, 2025

    We now project the Selic rate reaching 15.25% per year (previously 15.75%) by the end of the first half of this year.

  • Scenario | February, 2025

    Despite some short-term relief, the fundamentals still point to a depreciated exchange rate.

  • Scenario | January, 2025

    Besides our usual monthly economic update, we present 10 main themes and risks for Brazil’s economic outlook in 2025.

  • Scenario | December, 2024

    Given the deterioration in inflation expectations, the weaker BRL and still-resilient activity, we expect the Selic rate to reach 15% pa.

  • Scenario | November, 2024

    Risk of non-compliance with the fiscal framework increases the need for adjustments.

  • Scenario | October, 2024

    The reduced spending restraint in the latest bimonthly report suggests a limited fiscal adjustment and contributes to the perception of rising domestic risk

  • Scenario | September, 2024

    We see the Selic at 11.75% by YE24 after a 25-bp hike in September followed by two hikes of 50 bps later this year, with a final increase of 25 bps at the first meeting of next year.

  • Scenario | August, 2024

    Main themes for 2H24.

  • Scenario | July, 2024

    To signal the sustainability of the framework's expenditure rule ahead, cost-saving initiatives are vital.

  • Scenario | June, 2024

    We have revised our forecast for the year-end 2024 Selic benchmark rate to 10.50% p.a. (from 10.25%), remaining at this level until the end of 2025.

  • Scenario | May, 2024

    We assess that the room for additional easing is now more limited and project that the Selic rate will end the year at 10.25% pa.

  • Scenario | April, 2024

    We revised our Selic rate forecast to 9.75% (from 9.25%) by yearend, with a slowdown in easing pace from June onwards.

  • Brazil Orange Book - N40 | March, 2024

    2024 appeared to start better than the previous year, but we note cautious postures regarding expected growth and upcoming tax changes ahead.

  • Scenario | March, 2024

    The evolution of the international scenario as well as worse domestic inflationary dynamics will probably curtail the decline of interest rates in Brazil.

  • Scenario | February, 2024

    We maintain our 1.8% GDP growth forecast for 2024, but with an upward bias.

  • Scenario | January, 2024

    10 themes that we consider most important for the local outlook.

  • Scenario | December, 2023

    We now see a lower terminal Selic rate, at 9.00%, and a stronger BRL in 2024, at 4.90/USD.

  • Scenario | November, 2023

    We reduced our inflation estimates to 4.6% (from 4.9%) for 2023 and to 4.0% (from 4.1%) for 2024, but external challenges and domestic uncertainties (particularly regarding the fiscal consolidation outlook) will likely prevent faster Selic rate cuts ahead.

  • Scenario | October, 2023

    We maintain our call for the Selic rate at 11.50% in YE23 and 9.0% in YE24, but the external scenario and the fiscal outlook will be key to determine the easing pace and terminal rate ahead.

  • Scenario | September, 2023

    We now expect the Selic rate to reach 11.50% p.a. by the end of 2023 and 9.00% by the end of 2024.

  • Brazil Orange Book - N39 | August, 2023

    Given the contractionary stage of the monetary policy cycle, the economy is showing a good deal of resiliency. But growth will be significantly slower in the second half.

  • Scenario | August, 2023

    We revised our GDP growth forecast in 2023 to 2.5% from 2.3%. Regarding the monetary policy, we believe the central bank will continue to cut the Selic rate at a pace of 50 bps per meeting this year, to 11.75% pa by year-end.

  • Scenario | July, 2023

    We expect the Copom to deliver a 25-bp cut in August, followed by 50-bp reductions from September onwards.

  • Scenario | June, 2023

    We revised our 2023 growth forecast to 2.3% from 1.4% due to a strong 1Q23 and the expectation that income will support consumption.

  • Scenario | May, 2023

    Highlights: we’ve increased our GDP growth forecast to 1.4% (from 1.1%) in 2023, and reduced our FX forecast to BRL 5.15/USD (from 5.30).

Macro Vision

  • We estimate GDP to grow by 1.7% qoq in 1Q25

    2025/05/23 | The positive highlight should be the Agricultural sector, which, according to our estimates, expanded by 10.9% compared to 1Q24.

  • Made in China: Impact on Goods Inflation

    2025/05/14 | The redirection of Chinese exports may exert a disinflationary effect on goods in Brazil.

  • We forecast GDP growth of 0.4% qoq/sa in 4Q24

    2025/02/25 | If our estimate for 4Q24 GDP is confirmed, the GDP will end the year with an increase of 3.5%, with the service sector driving much of the rise.

  • Quality of Public Goods and Efficiency of Spending

    2025/02/25 | In this study, we show that Brazil underperforms in both quality and efficiency when compared to international benchmarks

  • What is the size of agribusiness in Brazil?

    2025/02/10 | Taking into account the primary production, processing, transport/trade and the use of resources, agribusiness equals to around 21% of GDP. In the external accounts, the sector is the key driver of Brazil’s trade surplus.

  • Foreign trade under the Trump administration

    2025/01/30 | The current context suggests downside risks outweigh upside ones, as the latter seem smaller than in 2018 and the risk of new tariffs on Brazilian exports is on the rise.

  • Interest rate cycles in Brazil

    2025/01/27 | This descriptive study analyzes 15 interest rate cycles since October 2002 to identify recurrences and patterns in monetary policy decisions.

  • The fundamental fiscal policy questions of 2025

    2025/01/23 | This report is a guide to the biggest fiscal events and debates of 2025.

  • Fiscal dominance in Brazil: Where do we stand?

    2025/01/21 | Fiscal dominance is a more continuous situation than a binary one. Recent stress and rise in risk premium suggest that we are not in full normality and reinforce the need for measures that improve fiscal perception.

  • Time to strengthen the fiscal framework

    2025/01/14 | A sustained improvement in financial conditions would only materialize with the outlook for a more balanced public debt trajectory.

  • We forecast GDP growth of 0.6% qoq/sa in 3Q24

    2024/11/28 | GDP slowed down in 3Q24 to 0.6%QoQ.

  • Freight prices to Brazil

    2024/11/05 | Freight prices in Brazil are likely to recede, in line with the movement already observed in global container prices, but these are unlikely to experience a complete normalization to the levels observed in 2023 any time soon.

  • Estimating the indirect impact on CPI

    2024/09/09 | Indirect impact of inputs on inflation.

  • We expect GDP growth of 1.0% qoq/sa in 2Q24

    2024/08/28 | Economy remained strong in 2Q24 due to higher household income, advancing 1.0% qoq/sa 2.8% yoy.

  • Online betting: Different metrics & evaluations

    2024/08/20 | Building on our study Macro Vision: Online betting, we present three possible definitions for the sector and our corresponding estimates.

  • Imports from China on the rise: relevant aspects

    2024/08/15 | In our view, the recent increase in imports underscores the need to advance with agendas aimed at improving the domestic business environment.

  • Online betting: Estimated size and impacts

    2024/08/13 | Based on the balance of payments, we estimate net spending on betting at BRL 24 billion per year.

  • Idat-Cars: The Itaú car price index

    2024/08/06 | This report presents the Itaú Car Price Index (Idat-Cars), Itau’s proprietary index of automotive prices.

  • Inflation in the horizon, simulating the BC model

    2024/07/23 | Moments of uncertainty can reduce the impact of monetary policy, making it insufficient to change inflation expectations and/or the exchange rate, resulting in higher inflation.

  • iSent: Itaú’s Central Bank sentiment classifier

    2024/07/05 | This report presents the iSent, the Itaú’s Central Bank sentiment index for Brazil and Chile, a sentiment classifier based on GPT-4.

  • Expenditure Control

    2024/06/20 | A diagnosis and proposals to control the rise in expenditures.

  • We expect 0.7% GDP growth in 1Q24

    2024/05/29 | Brazilian GDP should expand 0.7% in 1Q24. The 1Q24 GDP report will be released next Tuesday, June 4.

  • Revisiting estimates for the neutral interest rate

    2024/05/23 | Based on different methodologies, we reevaluate estimates of neutral real interest in Brazil

  • The weight of wages: A core measure that reweights

    2024/05/16 | We reweighted the IPCA according to the labor intensity of each item in order to see the impact of the tight labor market on inflation.

  • IDAT-Regional Activity: Methodology update

    2024/05/14 | Following this review, the regional version of IDAT becomes a daily indicator, broken down by state and covering online transactions, PIX, TED, DOC wire transfers and bank payment slips.

  • Court-ordered payments and the activity surprise

    2024/04/22 | Precatorios should have a positive impact on activity early this year

  • The importance of taming inflation expectations

    2024/03/25 | When it comes to deviations from the inflation target, how unanchored expectations are and for how long are both crucial.

  • Synchrony between neighbors: inflation surprises

    2024/02/27 | When a monthly consumer inflation reading in one country in the region delivers a surprise, inflation results in other countries tend to show deviation in the same direction.

  • 4Q23 GDP expected to decline 0.1% qoq/sa

    2024/02/19 | Brazilian GDP should expand 2.9% in 2023.

  • A guide to fiscal policy in Brazil in 2024

    2024/02/19 | This report is a guide to the main fiscal events and debates we anticipate for 2024.

History - Macro Brazil

History - Macro Vision