Itaú and Bradesco, two of Brazil’s largest private-sector banks, now expect the country’s economy to grow by less than 1% in 2027. Itaú cut its GDP growth forecast from 1.2% to 0.5% and raised its inflation forecast from 4.6% to 6.1%. Bradesco cut its growth forecast from 1.0% to 0.4% and raised its inflation forecast from 4.1% to 5.3%.
Itaú expects Brazil’s benchmark interest rate, the Selic, to remain at 13.75% throughout 2027, up from its previous year-end forecast of 12.50%. Bradesco expects rate cuts to resume in the second half, bringing the Selic to 12.75% by year-end, compared with 11.00% in its previous forecast.
Source: InfoMoney Read The Article
PSR Analysis. Slower growth and persistently high interest rates are likely to weaken Brazilian demand for vehicles and equipment in 2027. That will weigh on production in Brazil and on output at Argentine plants that build pickups and other vehicles for export to Brazil. A slowdown in South America’s largest economy will have repercussions across the region.PSR
