Brazil to see lower interest rates only in 2023; stagflation cannot be ruled out

COPOM is still expecting a strong recovery in the second semester, fiscal risks leading to an "upward bias" for inflation and the SELIC at 8.50% in 2022 and 6.75% in 2023.

RIO DE JANEIRO, BRAZIL - Let there be no illusions. Brazil seems to be heading towards the worst of all worlds: stagflation. Not a popular term, it combines low economic growth and high inflation. Brazil is familiar with both.

And, for the time being, there is no sign of respite in the price escalation which has well-known and serious consequences: it destroys the population's purchasing power; the expectation of product and service sales by companies, with an impact on production; and reduces points in the Gross Domestic Product (GDP). In order to tame inflation, the Central Bank is tightening . . .

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