Overview

• Banco Central reaffirmed a vigilant posture and said it could adjust future steps, including resuming hikes if deemed appropriate.
• The minutes project IPCA at 3.4% in the first quarter of 2027 and note core and services inflation remain above levels consistent with the target.
• Officials highlighted elevated external uncertainty, citing U.S. tariff announcements and Federal Reserve moves, and flagged the exchange rate as a key transmission channel after the real’s recent appreciation.
• The committee said activity is moderating as expected and recent inflation readings are more benign, yet still incompatible with the target.
• Market bets on rate cuts starting in January 2026 face new doubt, while SPX’s Rogério Xavier criticized the Copom’s technical approach and pointed to a clear economic slowdown and the need for fiscal adjustment in 2027.