Goldman Sachs: The Central Bank of Brazil is expected to alternate between rate cuts and pauses.

The Central Bank of Brazil last week lowered the Selic interest rate from 14.5% to 14.25%, and its next move remains unclear. As the country faces sticky inflation and the risk of economic slowdown, the meeting minutes provided some insights into the central bank’s thinking. Ramos stated that intermittent rate cuts “will result in more moderate output fluctuations, with inflation converging to the target level in the first quarter of 2028.” He said: “Overall, in the short-term trade-off between growth and inflation, the Copom is more inclined to protect economic activity rather than adopt a more aggressive inflation-focused strategy.”