The Banco Central do Brasil (BC, Brazil's central bank) kept its 2026 gross domestic product (GDP) growth projection at 1.6% in its Monetary Policy Report. It is the same figure as in the December report.
In 2025 the Brazilian economy had grown 2.3% — meaning the projection points to a slowdown.
Inflation and the ceiling
The BC projects the IPCA, Brazil's official inflation index, at 3.6% at the end of 2026. The target is 3%, with a tolerance range of 1.5% to 4.5%.
What changed was not the central projection but the risk around it: the probability of inflation breaking through the 4.5% ceiling in 2026 rose from 23% to 30%.
A projection that stays within the target while carrying almost a one-in-three chance of leaving it is a forecast and a warning at the same time.
For the following years, the report shows 3.3% in the third quarter of 2027 and 3.1% in the third quarter of 2028 — a slow convergence.
Interest rates
The Selic, Brazil's benchmark interest rate, was raised seven times in a row between September 2024 and June 2025 to 15% a year, held there for the next five meetings of the Copom, the central bank's rate-setting committee, and cut to 14.75% in the week before the report.
With information from Agência Brasil. Original report by Andreia Verdélio, published on March 26, 2026.
