Brazil’s Long-Awaited Interest Rate Cuts to Start With a Whimper

Brazil’s central bank is widely expected to begin easing monetary policy with a modest interest-rate cut, as war in the Middle East stokes inflation fears and complicates President Luiz Inacio Lula da Silva’s reelection bid.

Policymakers led by Gabriel Galipolo are likely to deliver their first reduction to the benchmark Selic rate since 2024 on Wednesday, lowering it by a quarter-point to 14.75%, according to 19 of 30 economists surveyed by Bloomberg. Ten others forecast a larger, half-point cut, while one expects borrowing costs to remain unchanged at 15%.