The chief economist at XP Investimentos, Caio Megale, considers that the Monetary Policy Committee (Copom) left open the possibility of a longer cycle of interest rate hikes, with two more increases of half a percentage point in the Selic.
After reading the communiqué in which the collegiate indicates that it will probably continue to raise interest rates, now at 12.75%, Megale observes that, at no point in the text, does the Copom make it clear that it intends to carry out the last rate increase at the June meeting.
“It says it will slow down the pace of the Selic’s rise, moving towards a finer adjustment. But at no time does the statement show that the BC is thinking about stopping. Conditions suggest that the cycle continues”, comments the chief economist at XP. . “The announcement is, in my view, a little tougher than the market expected. It is a communiqué that leaves the door open for a slightly more intense adjustment, and perhaps a little longer than what had been signaled before”, he adds. Megale.
He reiterated the XP forecast that points to the end of the monetary tightening cycle with the Selic rate at 13.75% per year, adding two more 0.5 percentage point increases at Copom meetings in June and August.
Given the adverse scenario, however, according to the economist, the possibility of the BC changing its mind and repeating this Wednesday’s dose cannot be ruled out, ending the cycle with a new increase of one percentage point next month.
