Boletim Focus: Brazil's market raises Selic and inflation forecasts

What Focus is. It is a weekly report from the Central Bank of Brazil. It sums up what the market expects for inflation, growth, the exchange rate and the Selic rate. The data is collected up to the Friday before the report comes out. The central bank stresses that the projections belong to the market, not to the bank. According to G1, the survey covers more than 100 financial institutions. This edition is dated October 30 and was published on November 3.

The indicators. IPCA is Brazil's official consumer price index, in other words inflation. Selic is the central bank's key interest rate. According to G1, it stands at 13.75% a year after five cuts this year. Since the start of 2025 the inflation target is 3%, with a tolerance band from 1.50% to 4.50%.

What changed in a week. The 2026 inflation forecast rose from 5.19% to 5.22%, and the 2027 forecast from 4.34% to 4.76%. The Selic forecast for the end of 2026 rose from 13.25% to 13.50%, and for the end of 2027 from 11.75% to 12.50%. G1 notes this means one more rate cut in 2026 instead of two. The exchange rate forecast for the end of 2026 rose from 5.05 to 5.34 reais per dollar, and for the end of 2027 from 5.15 to 5.40.

Growth. The GDP growth forecast for 2026 fell from 1.80% to 1.76%, and for 2027 from 1.31% to 1.20%. For 2027 that is the third week in a row of downward revisions.

Context. According to G1, the market revised its expectations after President Luiz Inácio Lula da Silva was re-elected on October 25. We do not judge politics. We only pass on how the sources link these numbers. The survey itself shows what analysts expect, not why.

How to read it. Every number above is a median forecast, not a fact about the future and not our forecast. Next week they may move in either direction. We give no buy or sell advice.

Where to look. What well-known traders and investors think about markets: https://freekonomist.com/en/crowd/ . This is an overview, not advice.

Fatos confirmados

• Focus sums up statistics of market expectations collected up to the Friday before the report is released; the projections are the market's, not the central bank's.^[1]
• The Focus edition is dated October 30, 2026, and the central bank's site shows a publication date of November 3, 2026.^[1]
• The survey covers more than 100 financial institutions.^[3]
• The forecast for 2026 inflation (IPCA) rose from 5.19% to 5.22%.^[2][3][4]
• The IPCA forecast for 2027 rose from 4.34% to 4.76%.^[2][3][4]
• The Selic forecast for the end of 2026 rose from 13.25% to 13.50% a year, and for the end of 2027 from 11.75% to 12.50%.^[2][3][4]
• The Selic rate is now 13.75% a year after five cuts this year; the new forecast implies one more cut in 2026 instead of two.^[3]
• The exchange rate forecast for the end of 2026 rose from 5.05 to 5.34 reais per dollar, and for the end of 2027 from 5.15 to 5.40.^[2][3][4]
• The GDP growth forecast for 2026 fell from 1.80% to 1.76%, and for 2027 from 1.31% to 1.20%.^[2][3][4]
• The GDP growth forecast for 2027 has now been cut for the third week in a row.^[2][4]
• Since the start of 2025 the inflation target is 3%, with a tolerance band from 1.50% to 4.50%.^[3]
• After President Lula's re-election on October 25, market economists made large changes to their expectations for inflation, interest rates, growth and the exchange rate.^[3]

Implicações

• ConfirmadoThe market raised its median forecasts for inflation, the Selic rate and the dollar for 2026 and 2027 compared with a week earlier.
• ConfirmadoThe growth forecasts for 2026 and 2027 were lowered.
• Nossa leituraThe 2026 inflation forecast of 5.22% is above the 4.50% upper edge of the tolerance band. This is our comparison of two numbers from the sources.
• Nossa leituraFocus forecasts change every week, so today's numbers do not guarantee future values. This is our view.

Ainda não se sabe

• Whether the Selic, inflation and dollar forecasts keep rising in the next Focus report
• How much of the change comes from the election result and how much from other news
• What the central bank decides at its next rate meeting

Quem é afetado

Brazil, Latin America. People who follow Brazil's economy, the real and the Selic rate, and importers and investors tied to that market

Fontes

1. Banco Central do Brasil: Focus - Relatório de Mercado, 30/10/2026 3 de novembro de 2026 · oficial
2. Banco Central do Brasil: Focus - Relatório de Mercado, Expectativas de Mercado, 30 de outubro de 2026 (PDF) 3 de novembro de 2026 · oficial
3. G1 (Globo): Após reeleição de Lula, mercado financeiro vê inflação mais alta e piora previsão para taxa de juros e dólar 3 de novembro de 2026 · mídia
4. InfoMoney: Boletim Focus: mercado eleva projeções para Selic, dólar e inflação 3 de novembro de 2026 · mídia