In March 2026, the Central Bank reduced the Selic rate by 0.25 percentage points, setting the basic interest rate of the economy at 14.75% per year. The decision was announced after the release of the minutes of the Monetary Policy Committee (Copom) on the 24th, which highlighted a global scenario of uncertainties due to geopolitical conflicts.
The Copom minutes indicated that the projection for inflation in 2026 remains high, estimated at 3.8%, above the target center of 3% defined by the Central Bank. This increase is associated, among other factors, with the persistence of inflation in services, which sustains resistance to attempts to lower prices.
Furthermore, the heated labor market and household income growing above productivity contribute to more resilient inflation. Therefore, the Central Bank pointed out that there is no firm commitment to new cuts in the Selic rate in the short term, adopting a more cautious approach given the ongoing pressures.
Among the inflationary risks highlighted are currency depreciation, cost pressures, and external instability that impact the Brazilian economic environment. However, the possibility of a global economic slowdown may mitigate inflationary pressures in the country, reducing the intensity of price increases.
The Copom made it clear that the decision aims at the convergence of inflation to the stipulated target, also seeking to stimulate employment carefully, taking into consideration the current fluctuations in the economic scenario. Thus, the Central Bank seeks to balance the objectives of price stability and sustainable growth.
Impacts of geopolitical conflicts on the Brazilian economy
The closure of the Strait of Hormuz since the end of February 2026 directly interferes with the global oil market, affecting about 20% of the world’s commodity trade. In Brazil, this situation aggravates the already pressured scenario by the import of approximately 10% of the refined oil consumed domestically. Consequently, the increase in fuel prices, especially diesel and gasoline, has influenced logistics costs and raised the prices of various products in the country.
Moreover, the Brazilian road transport sector, responsible for most cargo movement within the national territory, signals the possibility of strikes by truck drivers. These professionals express concern about the high costs, which compromise the profitability of operations and threaten the stability of supply. Thus, the risk of shortages in different regions of Brazil grows, directly affecting the daily lives of the population.
Simultaneously, the continuation of conflicts between Russia and Ukraine, as well as the confrontation between Iran and Israel involving the United States, keeps the global economic and geopolitical scenario unstable. This directly influences the volatility of international markets and worsens insecurity regarding the supply of strategic raw materials. Finally, experts recommend strengthening the national refining capacity, as well as encouraging alternative energy sources, to reduce external dependence and promote greater autonomy for Brazil in this turbulent context.
