Election effect: economists revise almost all projections and future inflation rises in Focus
According to Money Times, inflation, interest and exchange rate expectations worsened in Focus this Monday (3), with revisions following the poll results.
BY THE X-TRADER NEWS NEWSROOM · REPORTING FROM MONEY TIMES · 2 MIN
Projections for the Brazilian economy got worse this Monday (3), and almost all of them were revised. According to Money Times, the Central Bank's Focus Report recorded a worsening in inflation, interest and exchange rate expectations.
The survey was collected at the end of last week, after the negative repercussion of the results of the polls that re-elected Lula for a fourth term. In other words, the portrait reflects the analysts' reading immediately after a relevant political decision, and not just the routine economic data.
The most noticeable change appears in 2026 inflation. According to Money Times, the median projections rose from 5.19% to 5.22%, now above the 5% mark. It is the deadline closest to the consumer, and the movement is not limited to it.
The following years tell a similar story. For 2027, the projection was from 4.34% to 4.76%, the third weekly increase in a row. In 2028, the median went from 3.75% to 4.00%, and in 2029, from 3.50% to 3.98%. When expectations rise over longer horizons, the discussion stops being about a passing shock and becomes about credibility.
From the perspective of fiscal responsibility, which guides the editorial line of this newspaper, the message is straightforward: deteriorating expectations signal distrust about the direction of the accounts and the conduct of economic policy. This is the point that tends to gain weight in the public debate in the coming weeks.
What changes for the investor
This bulletin does not provide prices or recommendations, but it helps to understand the scenario. Expectations of higher inflation and interest rates often weigh on rate-sensitive assets, and the yield curve is the most direct barometer for monitoring this reaction. In terms of foreign exchange, the worsening of projections affects those who hold the dollar or shares linked abroad, including securities traded on the Nasdaq. It is worth observing whether the next revisions confirm the trend or whether the movement loses strength.
Automatically translated from Portuguese.
