Why do Brazilian inflation expectations keep rising? – The Brazilian Report

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By the end of this year, Brazil’s Central Bank will have jacked up the Selic benchmark interest rate by at least 7 percentage points — more than practically any of its peers around the world. Even considering that the Selic started from a record-low 2 percent a year baseline, this tightening process is huge — and is widely expected to continue into early 2022. 
According to market expectations, Brazil will end 2022 with short-term real interest rates (i.e. expected policy rate minus expected inflation) north of 7 percent, considerably more than any other emerging economy. Russia comes in second,…
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