Brazil's Focus Survey Trims 2026 Inflation Outlook to 4.05%

Overview

• The median IPCA forecast for 2026 slipped to 4.05% from 4.06%, remaining 0.45 percentage point below the 4.5% ceiling set by the CMN.
• IBGE reported full-year 2025 inflation at 4.26% after a 0.33% rise in December, with the biggest impact from transport and health services.
• Focus shows the Selic projected to decline from 15% to 12.25% by end-2026 and to 10.50% in 2027, with 2028 at 9.88%.
• Inflation expectations for 2027 and 2028 held at 3.80% and 3.50% for the 10th straight week, with 2029 steady at 3.50%.
• GDP growth medians stayed at 1.8% for 2026–2027 and 2.0% for 2028, while the year-end dollar remained at R$5.50 for 2026–2027 and R$5.52 for 2028.