PicPay Estimates Basic Selic Rate at 10.5% per Year until the End of 2024
PicPay, known for its accurate economic projections, has revised its estimate for the basic interest rate, the Selic, now predicting a value of 10.5% per year until the end of 2024. This change is based on the continued deterioration of expectations of inflation, which should lead the Central Bank's Monetary Policy Committee (Copom) to interrupt the cycle of interest cuts at the next meeting, in June.
PicPay analysts highlight that this review reflects current economic uncertainties, especially related to inflation and government fiscal policies. They consider the possibility of the Copom pausing the cycle of interest cuts, which signals a possible increase in the Selic rate to control inflation.
- Revision of the Selic rate estimate to 10.5% per year until the end of 2024.
- The Copom is expected to interrupt the interest rate cutting cycle at the next meeting.
- Reflection of the review on current economic uncertainties, especially inflation and government fiscal policies.
Impact of economic expectations on the market
PicPay's team of analysts is attentive to the possible impact of Copom's recent decisions on market expectations. They highlight the evidence of dissent among Copom members at the last meeting, combined with changes in the government's fiscal targets for 2025 and 2026, as reasons for concern about the future trajectory of monetary policy.
- Observation of the impact of Copom decisions on market expectations.
- Concern about dissent among Copom members and changes to the government's fiscal targets.
PicPay's approach to the impact of economic expectations on the market demonstrates a high level of analysis and forecasting, reflecting its concern with the consequences of Copom's decisions and the government's fiscal policies.
However, some criticisms can be made. For example, while it is crucial to monitor dissent in the Copom and changes to fiscal targets, it would be interesting to see a more in-depth analysis of how these specific factors can directly affect financial markets and the economy as a whole. Additionally, the company could offer more concrete suggestions on how investors can prepare for these potential changes, adding even more value to its analysis and insights.
Perspectives for the Brazilian Economy
In addition to projections for Selic, PicPay also evaluates other aspects of the Brazilian economy. The digital bank predicts an impact of 0.17 percentage points on the country's Gross Domestic Product (GDP) due to the floods in Rio Grande do Sul. As for inflation, estimates point to a rate of 3.8% in 2024 and 4, 2% in 2025, both above the 3% target, but within the tolerance range established by the government. These projections highlight the vulnerability of the Brazilian economy to climate events and the need for effective policies to control inflation and promote sustainable economic growth.
- Forecast of an impact of 0.17 percentage points on GDP due to the floods in Rio Grande do Sul.
- Inflation estimates above the target, but within the tolerance range established by the government.
- Highlighting the vulnerability of the Brazilian economy to climate events and the need for effective policies to control inflation and promote sustainable growth.
Conclusion
PicPay's projections for the Selic base rate and for the Brazilian economy reflect a complex economic scenario, marked by uncertainty and the need for effective policies. The revised Selic estimate and concerns about inflation and fiscal policies highlight the importance of a careful and balanced approach to monetary and fiscal policy. Furthermore, the impact of the floods in Rio Grande do Sul highlights the country's vulnerability to extreme weather events, highlighting the importance of planning and resilience.
What are your opinions on PicPay's projections for the Selic rate and the Brazilian economy? Leave your comment below and share your perspectives on the current economic scenario and the policies needed to promote sustainable growth.
