September’s inflation preview, measured by IPCA-15, surprised with widespread increases, raising alarms for monetary policy and future cuts in the Selic rate.
The Brazilian economy registered a setback in its disinflation projections for September, with the National Broad Consumer Price Index 15 (IPCA-15) showing a significant rise. The inflation preview recorded 0.70% for the month, a notable jump of 1.10 percentage points compared to the deflationary rate of -0.40% observed in August.
This result, indicating a widespread increase in prices, reignites discussions about the pace of the Central Bank’s monetary policy. With the 12-month accumulated indicator reaching 4.47% – dangerously close to the 4.5% target ceiling – the scenario for reducing the Selic interest rate becomes more complex, demanding caution and in-depth analysis from economic authorities.
Widespread Pressure Across All Sectors
The report from the Brazilian Institute of Geography and Statistics (IBGE) revealed that all nine groups of products and services that make up the IPCA-15 registered price increases in September. This fact is a worrying sign, as it indicates that inflationary pressure was not restricted to specific sectors but rather spread throughout the economy.
The largest positive impact came from the Housing group, with a variation of 2.07% and a contribution of 0.31 percentage points to the overall index. Other groups, such as Personal Expenses (0.96%), also contributed to the rise, while Education recorded the lowest variation at 0.03%.
In the year-to-date accumulated figures, the IPCA-15 reached 3.82%. Compared to September 2025, when the index was 0.48%, the current preview highlights an intensification of inflation. The IPCA-E, which consolidates the IPCA-15 quarterly, stood at 0.36%, lower than the 0.67% recorded in the same period last year.
Impact on Interest Rates and Expectations
The September IPCA-15 reading, above the financial market’s expectations, reinforces the thesis that the Central Bank may be forced to maintain high interest rates for longer. This perspective was corroborated by analysts, who see the environment of unanchored inflation expectations as a factor for caution for the Monetary Policy Committee (Copom).
“The pressure spread across nine out of nine groups is not an isolated event; it is disseminated inflation. And the number that really changes the conversation is the twelve-month accumulated figure, which went from 4.24% to 4.47%, practically touching the target ceiling of 4.5%. This makes the next interest rate cut much more difficult, and I would say that the Central Bank has gained justification.”
For 2027, market projections for inflation are at 4.3%, significantly above the target center of 3%. Faced with this scenario, the Copom will grapple with the challenge of balancing the need to control inflation with the pursuit of more robust economic growth, which still feels the effects of the restrictive monetary policy.
Future Scenario for Companies and Consumers
The maintenance of high interest rates for an extended period implies slower economic recovery for 2027. Credit, consumption, and investments will continue to feel the impacts of monetary policy with some lag. If disinflation loses strength, the room for Selic rate cuts will diminish, and growth may remain in the range of 1% to 1.5%, with credit still being selective.
For companies, the focus in 2027 will not solely be on waiting for the Selic rate to drop but rather on how to manage cash, payments, working capital, and financing in a context of high capital costs. In this scenario, operational efficiency and the search for new revenue streams, even with more expensive money, will be crucial for the sustainability and success of businesses in the Brazilian economy.
