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The decision to increase the government's annualized benchmark interest rate (Selic) by 0.50% at the last meeting of the Monetary Policy Committee (Copom) led financial institutions and market analysts to raise their expectations regarding year-end prospects.
Their previous forecast of 17% for the year-end Selic was readjusted to 17.50%.
This month's Copom meeting, therefore, is expected to elevate the Selic from its current level of 16.75% to 17.25%.
If no major short-term alterations occur, the market projects a Selic of 15.50% for next year.
The estimates reported in last week's survey also received upward corrections for the trade surplus (from US$ 32.63 billion to US$ 32.95 billion) and the rate of growth in industrial production (from 7.20% to 7.30%).
The other indicators remained unchanged. The exchange rate is still expected to end the year with the dollar quoted at R$ 2.95, and the growth of the Gross Domestic Product (GDP) this year is still expected to be 4.56%.
The market also maintained its forecasts of a US$ 10 billion surplus in foreign current transactions, US$ 15 billion in foreign direct investments, and a 55% ratio between net government debt and the GDP.
Agência Brasil
Translator: David Silberstein
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