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Brazil: 2026 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Brazil

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  • International Monetary Fund

Abstract

Brazil’s economy has shown remarkable resilience in recent years despite a series of shocks, including global trade tensions. Resilience is being tested again by the economic fallout of the war in the Middle East. Growth moderated in 2025 amid tight monetary policy and a gradual withdrawal of fiscal support, narrowing the positive output gap which, together with strong currency appreciation, supported disinflation. Medium-term inflation expectations remain above target. The Central Bank of Brazil (BCB) delivered three quarter-point cuts to the policy rate in the first half of 2026, after being on hold since mid-2025, but signaled greater caution regarding future interest rate cuts in light of upside inflation risks. Meanwhile, important fiscal and structural challenges remain, including high and rising public debt, and lagging productivity growth. General elections will be held in October 2026.

Suggested Citation

  • International Monetary Fund, 2026. "Brazil: 2026 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Brazil," IMF Staff Country Reports 2026/191, International Monetary Fund.
    • Handle: RePEc:imf:imfscr:2026/191
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