Forex News
The Bank of England (BoE) raised its Bank Rate by 25 basis points to 4.00%, with eight policymakers backing the move and Catherine Mann preferring a larger 50-basis-point increase. The decision came as the BoE sharply lifted its inflation forecasts and warned that energy pressures could require further tightening.
The “Old Lady” now anticipates inflation to peak at roughly 5% in Q2 2027, up from its earlier prediction of 3.2% in late 2026. The CPI is not likely to recover to the 2% objective until Q3 2028, while under the Bank’s bad scenario inflation would rise to 6.2% if the energy shock worsens.
Governor Andrew Bailey said there was already enough inflationary pressure in the pipeline to warrant the rise. The current boost may not be the last, he cautioned, and the Middle East crisis may not be over. But he underlined it should not be taken as the start of an inevitable series of rate rises. The Bank still sees scant evidence of second-round impacts, but stronger-than-expected activity has bolstered the argument for tighter policy.
The economic picture is ambiguous: the BoE has lifted its growth predictions for the near-term and now sees GDP expanding by 1.6% in 2026, although growth is expected to drop to 1.3% in 2027 and 1.2% in 2028. Unemployment is likely to increase slowly but pay growth is now expected to be more than originally estimated. The government’s budget is predicted to dampen inflation briefly, but the impact is likely to be reversed later.
The message was broadly hawkish, but not a pledge to continue tightening. MPC members Lombardelli and Pill think there is a case for another hike in the near future, while Greene suggested further hikes would likely be needed. Bailey said existing policy was generally restrictive enough and that some of the increase in market-rate expectations was due to risk premia rather than the Bank’s predicted course. The MPC has hiked rates to guard against a worse inflation outcome, but has deliberately kept its next move open.
Bank of England (BoE) Governor Andrew Bailey said that the central bank is “watching the extent of inflation pass-through,” while acknowledging that inflation risks are tilted to the upside, after the BoE raised interest rates to 4% on Thursday.
Bailey added that future decisions hinge on how fast inflation edges lower towards the BoE’s 2% inflation target. He said that a resolution of the US-Iran conflict “would bring limited relief from inflation.”
Key highlights:
The BoE is watching the extent of inflation pass-through.
Inflation risks are on the upside, which could change
The future decisions hinge on how fast inflation comes down.
Peace moves would bring limited relief from inflation
Inflation is baked in currently due to the energy price cap
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.12% | 0.04% | -0.30% | 0.27% | 0.77% | 0.30% | -0.14% | |
| EUR | -0.12% | -0.08% | -0.43% | 0.15% | 0.64% | 0.17% | -0.26% | |
| GBP | -0.04% | 0.08% | -0.36% | 0.23% | 0.72% | 0.27% | -0.19% | |
| JPY | 0.30% | 0.43% | 0.36% | 0.57% | 1.07% | 0.58% | 0.15% | |
| CAD | -0.27% | -0.15% | -0.23% | -0.57% | 0.50% | 0.02% | -0.42% | |
| AUD | -0.77% | -0.64% | -0.72% | -1.07% | -0.50% | -0.45% | -0.92% | |
| NZD | -0.30% | -0.17% | -0.27% | -0.58% | -0.02% | 0.45% | -0.42% | |
| CHF | 0.14% | 0.26% | 0.19% | -0.15% | 0.42% | 0.92% | 0.42% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
BoE FAQs
The Bank of England (BoE) decides monetary policy for the United Kingdom. Its primary goal is to achieve ‘price stability’, or a steady inflation rate of 2%. Its tool for achieving this is via the adjustment of base lending rates. The BoE sets the rate at which it lends to commercial banks and banks lend to each other, determining the level of interest rates in the economy overall. This also impacts the value of the Pound Sterling (GBP).
When inflation is above the Bank of England’s target it responds by raising interest rates, making it more expensive for people and businesses to access credit. This is positive for the Pound Sterling because higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls below target, it is a sign economic growth is slowing, and the BoE will consider lowering interest rates to cheapen credit in the hope businesses will borrow to invest in growth-generating projects – a negative for the Pound Sterling.
In extreme situations, the Bank of England can enact a policy called Quantitative Easing (QE). QE is the process by which the BoE substantially increases the flow of credit in a stuck financial system. QE is a last resort policy when lowering interest rates will not achieve the necessary result. The process of QE involves the BoE printing money to buy assets – usually government or AAA-rated corporate bonds – from banks and other financial institutions. QE usually results in a weaker Pound Sterling.
Quantitative tightening (QT) is the reverse of QE, enacted when the economy is strengthening and inflation starts rising. Whilst in QE the Bank of England (BoE) purchases government and corporate bonds from financial institutions to encourage them to lend; in QT, the BoE stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive for the Pound Sterling.
European Central Bank (ECB) President Christine Lagarde crossed the wires on Thursday and said that “the current situation is made hard by the energy shock and AI pulling in opposite directions.”
Lagarde said that it is “Still necessary to apply tools to avoid inflation running away,” and doesn’t expect “US tariffs to be revisited right away.”
Key highlights:
The current situation is made hard by the energy shock and AI pulling in opposite directions.
Very difficult to disentangle supply-driven and demand-driven shocks.
Still necessary to apply tools to avoid inflation running away.
We will have many indicators between now and December.
Don't expect US tariffs to be revisited right away.
Euro Price Today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.11% | 0.06% | -0.33% | 0.28% | 0.84% | 0.35% | -0.17% | |
| EUR | -0.11% | -0.05% | -0.48% | 0.17% | 0.73% | 0.23% | -0.29% | |
| GBP | -0.06% | 0.05% | -0.40% | 0.22% | 0.78% | 0.29% | -0.23% | |
| JPY | 0.33% | 0.48% | 0.40% | 0.62% | 1.19% | 0.66% | 0.17% | |
| CAD | -0.28% | -0.17% | -0.22% | -0.62% | 0.57% | 0.05% | -0.45% | |
| AUD | -0.84% | -0.73% | -0.78% | -1.19% | -0.57% | -0.48% | -1.01% | |
| NZD | -0.35% | -0.23% | -0.29% | -0.66% | -0.05% | 0.48% | -0.49% | |
| CHF | 0.17% | 0.29% | 0.23% | -0.17% | 0.45% | 1.01% | 0.49% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
ECB FAQs
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic.
Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.
- AI-focused stocks fall again on moratorium worries following a Democratic sweep in the midterms.
- NASDAQ has given back Wednesday's gains as the broader market pivots into the defensive side.
A fresh wave of selling in AI-linked stocks is pulling Wall Street into one of its worst days in recent memory. A Democratic win in both the upper and lower houses has added fresh worries that AI data center projects could face renewed moratoriums and regulatory pressures.
The AI segment's 'pick and shovel' layer is getting blown out, and knock-on fears are spreading into the microchip and semiconductor sectors, dragging broader markets into the red. The Nasdaq tech index is down 5%, falling around 1,400 points, while the S&P 500 and Dow Jones Industrial Average have shed roughly 3% and 2%, respectively.
Fitch says a major share of planned data centre capacity may face regulatory hurdles under incoming governors in Texas, Georgia, and Ohio, capacity the NASDAQ 100's biggest companies build or sell into.
Nasdaq 100 5-minute chart
Nasdaq FAQs
The Nasdaq is a stock exchange based in the US that started out life as an electronic stock quotation machine. At first, the Nasdaq only provided quotations for over-the-counter (OTC) stocks but later it became an exchange too. By 1991, the Nasdaq had grown to account for 46% of the entire US securities’ market. In 1998, it became the first stock exchange in the US to provide online trading. The Nasdaq also produces several indices, the most comprehensive of which is the Nasdaq Composite representing all 2,500-plus stocks on the Nasdaq, and the Nasdaq 100.
The Nasdaq 100 is a large-cap index made up of 100 non-financial companies from the Nasdaq stock exchange. Although it only includes a fraction of the thousands of stocks in the Nasdaq, it accounts for over 90% of the movement. The influence of each company on the index is market-cap weighted. The Nasdaq 100 includes companies with a significant focus on technology although it also encompasses companies from other industries and from outside the US. The average annual return of the Nasdaq 100 has been 17.23% since 1986.
There are a number of ways to trade the Nasdaq 100. Most retail brokers and spread betting platforms offer bets using Contracts for Difference (CFD). For longer-term investors, Exchange-Traded Funds (ETFs) trade like shares that mimic the movement of the index without the investor needing to buy all 100 constituent companies. An example ETF is the Invesco QQQ Trust (QQQ). Nasdaq 100 futures contracts allow traders to speculate on the future direction of the index. Options provide the right, but not the obligation, to buy or sell the Nasdaq 100 at a specific price (strike price) in the future.
Many different factors drive the Nasdaq 100 but mainly it is the aggregate performance of the component companies revealed in their quarterly and annual company earnings reports. US and global macroeconomic data also contributes as it impacts on investor sentiment, which if positive drives gains. The level of interest rates, set by the Federal Reserve (Fed), also influences the Nasdaq 100 as it affects the cost of credit, on which many corporations are heavily reliant. As such the level of inflation can be a major driver too as well as other metrics which impact on the decisions of the Fed.
Bank of Canada (BoC) Governor Tiff Macklem appeared in the House of Commons, saying there may be a need to raise rates further.
Macklem added that in the current circumstances he does not think fiscal policy is making it harder to bring inflation down.
Canadian Dollar Price Today
The table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.02% | -0.01% | -0.35% | 0.22% | 0.68% | 0.19% | -0.26% | |
| EUR | -0.02% | -0.03% | -0.37% | 0.19% | 0.68% | 0.17% | -0.30% | |
| GBP | 0.01% | 0.03% | -0.34% | 0.22% | 0.71% | 0.21% | -0.26% | |
| JPY | 0.35% | 0.37% | 0.34% | 0.56% | 1.03% | 0.52% | 0.08% | |
| CAD | -0.22% | -0.19% | -0.22% | -0.56% | 0.48% | -0.03% | -0.48% | |
| AUD | -0.68% | -0.68% | -0.71% | -1.03% | -0.48% | -0.49% | -0.98% | |
| NZD | -0.19% | -0.17% | -0.21% | -0.52% | 0.03% | 0.49% | -0.44% | |
| CHF | 0.26% | 0.30% | 0.26% | -0.08% | 0.48% | 0.98% | 0.44% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).
Bank of Canada FAQs
The Bank of Canada (BoC), based in Ottawa, is the institution that sets interest rates and manages monetary policy for Canada. It does so at eight scheduled meetings a year and ad hoc emergency meetings that are held as required. The BoC primary mandate is to maintain price stability, which means keeping inflation at between 1-3%. Its main tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Canadian Dollar (CAD) and vice versa. Other tools used include quantitative easing and tightening.
In extreme situations, the Bank of Canada can enact a policy tool called Quantitative Easing. QE is the process by which the BoC prints Canadian Dollars for the purpose of buying assets – usually government or corporate bonds – from financial institutions. QE usually results in a weaker CAD. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The Bank of Canada used the measure during the Great Financial Crisis of 2009-11 when credit froze after banks lost faith in each other’s ability to repay debts.
Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the Bank of Canada purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the BoC stops buying more assets, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Canadian Dollar.
On Thursday, Richmond Federal Reserve (Fed) President Thomas Barkin said inflation is the most important risk for the Fed right now, adding that the policy path is straightforward and that a gradual pace of rate increases “makes sense.”
Barkin said that “inflation is too high,” and although he doesn’t hear it escalating, he also doesn’t hear it cooling. Regarding the labor market, he added that companies are still cautious about hiring, “but are not yet firing.”
Key highlights:
Demand in the economy is solid, though some sectors don’t feel it
Businesses are still cautious about hiring but are not yet firing
There is cost pressure on businesses
Earnings remain strong, and that is encouraging firms to invest and hold onto workers
The set of cost pressures of the past 18 months, starting with tariffs, are broad based and firms feel they have to pass them along
Do not anticipate inflation will accelerate, but also don’t see it falling at this point
The path on policy is straightforward; the issue now is pace and gradual “Makes sense”
Policy right now is somewhere around neutral
AI is a big part of current strong demand
Interest rates are probably not the top thing that would curb AI, but they will have some impact
Inflation is the most important risk for the Fed right now
The budget deficit is “sizeable,” fiscal policy over the past few years has been a tailwind for the economy
Do not have a point of view about what will happen to fiscal policy following the election
Do not think AI is what is currently driving productivity as much as adaptation to the labor shortages that began during the pandemic
AI buildout has definitely had an inflationary impact in the near term
Data centers, because of lack of employees, do not have natural constituencies in the communities where they are located
Change in number of policy setting meetings is not a big deal
Changing the pace of policy meetings does has the advantage of a better flow of data for each session
On communications the Fed needs to land at a place where both the Chairman and the committee are comfortable
Credit dynamics in the banking sector are “Reassuring” at this point
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.07% | -0.00% | -0.32% | 0.19% | 0.65% | 0.21% | -0.26% | |
| EUR | -0.07% | -0.07% | -0.41% | 0.12% | 0.58% | 0.14% | -0.34% | |
| GBP | 0.00% | 0.07% | -0.32% | 0.19% | 0.66% | 0.22% | -0.27% | |
| JPY | 0.32% | 0.41% | 0.32% | 0.52% | 0.99% | 0.52% | 0.05% | |
| CAD | -0.19% | -0.12% | -0.19% | -0.52% | 0.47% | 0.00% | -0.46% | |
| AUD | -0.65% | -0.58% | -0.66% | -0.99% | -0.47% | -0.43% | -0.93% | |
| NZD | -0.21% | -0.14% | -0.22% | -0.52% | -0.01% | 0.43% | -0.45% | |
| CHF | 0.26% | 0.34% | 0.27% | -0.05% | 0.46% | 0.93% | 0.45% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
- BoE raises rates to 4% in an 8-1 split decision.
- UK inflation forecast jumps to 4.4%, signaling further tightening risks.
- US jobless claims fall to 189K as Fed officials favor gradual hikes.
The Pound Sterling (GBP) erases its previous gains against the US Dollar (USD) on Thursday even though the Bank of England (BoE) raised rates to 4%, narrowing the differential with the Federal Reserve (Fed), but solid US data and hawkish comments by Fed officials weighed on the UK currency. At the time of writing, GBP/USD trades at 1.3467, virtually unchanged.
GBP/USD surrenders earlier gains on strong US data and hawkish Fed rhetoric offsetting BoE tightening
The BoE increased the Bank Rate in an 8-to-1 split decision, with Catherine Mann voting for a 50-basis-point rate hike. Of note, the BoE raised its inflation forecast to 4.4% in Q1 2027, up from 3.2% in July, suggesting further rate hikes lie ahead. Nevertheless, the BoE sees limited evidence of second-round effects from higher energy prices.
At the press conference, BoE Governor Andrew Bailey said another rate increase “may be warranted,” adding that progress in the Iran conflict could limit inflationary pressures. He rejected the idea that just two rate hikes are needed; instead, he said that it would depend on risks.
Among the Monetary Policy Committee, BoE’s Pill, Lombardelli, Greene, and, obviously, Mann see additional rate hikes in the future.
In the US, the labor market remains solid as Initial Jobless Claims for the week ending October 31 dipped from 195K to 189K, below forecasts of 196K. Also, the Challenger Job Cuts for October rose from 43.281K to 43.994K, up just 2% from September, revealed Challenger, Grey and Christmas. Despite the uptick in layoffs, employers announced plans to hire 444.692K workers last month, a 57% jump from a year ago.
Meanwhile, Fed officials crossed the wires. Cleveland Fed President Beth Hammack said that she favors a gradual approach on rate increases, adding that the Fed has more work to do. Meanwhile, Richmond Fed President Thomas Barkin said that “broad-based” inflation remains too high and echoed Hammack's comments about a gradual approach.
Given the backdrop, GBP/USD remains subdued as traders expect further BoE rate hikes. Nevertheless, the Fed’s hawkish rhetoric and solid jobs data cap the advance as investors continue to assess the Democratic sweep in the US midterm elections.
Ahead, the UK docket is absent, but in the US, market participants eye the release of Nonfarm Payrolls.
GBP/USD Price Forecast: Technical outlook
In the daily chart, GBP/USD trades at 1.3476. The pair holds a constructive near-term bullish bias as spot remains above the latest simple moving average cluster around 1.3366 and the rising trend-line support derived from the 1.3140 base near 1.3360, indicating underlying demand on dips. Momentum backs this stance, with the 14-period Relative Strength Index hovering around 64, suggesting firm but not yet extreme buying pressure, while the FXS Fed Sentiment Index stabilizing near 144 hints that broader USD-driven headwinds are contained for now.
On the topside, initial resistance is seen at the latest reaction high along the descending resistance trend line around 1.3508, followed by a more robust cap at the next downward-sloping resistance line near 1.3544, with the higher rising-trend reference from the 1.3159 support sequence at 1.3606 reinforcing the broader supply zone overhead. On the downside, immediate support is found at the nearby moving-average-backed floor and lower rising trend line clustered around 1.3366–1.3360, where a break would weaken the bullish tone and expose a deeper corrective phase toward prior swing levels on the daily chart.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.04% | -0.04% | -0.30% | 0.15% | 0.55% | 0.11% | -0.28% | |
| EUR | -0.04% | -0.08% | -0.37% | 0.11% | 0.50% | 0.08% | -0.33% | |
| GBP | 0.04% | 0.08% | -0.30% | 0.19% | 0.59% | 0.15% | -0.25% | |
| JPY | 0.30% | 0.37% | 0.30% | 0.46% | 0.87% | 0.41% | 0.03% | |
| CAD | -0.15% | -0.11% | -0.19% | -0.46% | 0.40% | -0.05% | -0.44% | |
| AUD | -0.55% | -0.50% | -0.59% | -0.87% | -0.40% | -0.41% | -0.84% | |
| NZD | -0.11% | -0.08% | -0.15% | -0.41% | 0.05% | 0.41% | -0.37% | |
| CHF | 0.28% | 0.33% | 0.25% | -0.03% | 0.44% | 0.84% | 0.37% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Societe Generale reports the Banco Central do Brasil (BCB) has halted its five‑meeting easing cycle, leaving Selic at 13.75% amid post‑election volatility and fiscal uncertainty. Economist Dev Ashish now expects the policy rate to stay unchanged through 2Q27, with cuts resuming only once inflation expectations stabilise and fiscal visibility improves, implying around 100 bps of easing and a 12.75% Selic by end‑2027.
High rates maintained to rebuild credibility
"Elsewhere, the BCB left the Selic rate unchanged at 13.75% yesterday, bringing its five-meeting easing cycle to a halt in response to post-election market volatility and fiscal uncertainty."
"Policymakers acknowledged the more challenging inflation outlook but stopped short of validating market expectations for renewed tightening, opting instead to preserve flexibility."
"Despite weakening growth and still-restrictive real rates, the message was clear: restoring policy credibility takes priority."
"Our economist Dev Ashish now expects Selic rate to remain unchanged through 2Q27, with easing resuming only after inflation expectations stabilise and fiscal visibility improves, leaving scope for around 100bp of cuts in 2027 and an end-2027 Selic rate of 12.75%."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
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