Inflation Expectations in Brazil

In order to reanchor expectations, the elected president will have to prioritize inflation’s return to its target. In its latest poll among economic analysts, the Brazilian Central Bank (BCB) computed the median of inflation expectations for 2014 above 6.5%, the ceiling of the band around the inflation target (4.5%). This has heated the debate about […]

Brazil: Reacting to Adverse External Scenario

In a scenario of capital flight, the BCB must intervene also via FX reserves sales. When, in late May, the FED announced the tapering, market reaction was dramatic. Yet, when it announced, in late December, the actual plan it intends to put into effect starting this month,  reactions were not as intense. The chart shows […]