For months, the monetary authority maintain your interest rate of reference (Selic) without changes in 13.75%after a process of increasing it that took it in a year and a half from a floor of 2%.
The goal is to lower inflation.which in December past was from 5.9% per yearthe lowest level since the beginning of 2021, although still higher than the Central Bank’s annual target of 3.5%.
The expectation official is that for this year inflation accumulates 4.8%moderating in 2024 at 2.9%. Still, the Central Bank did not show signs of a drop in rates and firms such as Credit Suisse directly ruled it out for this year, based on the uncertainty about what spending and the fiscal outlook will be like after the recent inauguration of the Government of Luiz Inacio Lula da Siva.
Yes ok increased debt burdenthe level of delinquency and default in Brazilian households continues in a single digit. The level of delinquency average reached 5.9% at the end of 2022one point and a half higher than a year ago.
In its latest inflation report, the Brazilian Central Bank warned against high levels of household debt, although, at the same time, The bank’s governor, Roberto Campos Neto, affirmed that the stress tests indicated that the banking system appears to be in a “very healthy” state.
“Most of the increase in household loans for the past year it was through loans with lower interest rates”, affirmed Fernando Rocha, head of statistics of the Central Bank.
Source: Ambito
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