The dollar was lower this Monday (12/15), during a day in which investors reflected indicators released earlier, such as the Central Bank’s Economic Activity Index (IBC-Br), considered a “preview” of the gross domestic product (GDP), and the Focus report, which brings together the main financial market projections for the Brazilian economy.
On the international stage, the market follows the statements of officials of the Federal Reserve (Fed, Central Bank of the United States) and also monitors data on industrial production and retail sales in China.
Dollar
- At 10:05 a.m., the US currency fell 0.44% and was trading at R$5.388.
- Last Friday (12/12), the dollar ended the session up 0.11%, quoted at R$5.41.
- As a result, the American currency accumulated gains of 1.41% over the month and losses of 12.45% over the year against the real.
Ibovespa
- At 10:10 a.m., Ibovespa, the main index of the Brazilian Stock Exchange (B3), advanced 0.81%, to 162 thousand points.
- On Friday, the indicator closed the session up 0.99%, at 160.7 thousand points.
- As a result, the Brazilian Stock Exchange accumulated an appreciation of 1.07% in December and 33.66% in 2025.
GDP records fall
The Central Bank’s Economic Activity Index (IBC-Br) showed that the Brazilian economy shrank by 0.2% in October compared to the previous month. The data was published by the Central Bank (CB).
This is the second consecutive negative result. September also saw a decline of 0.2%. Over the quarter, there was also a decrease of 0.2%.
To achieve this result, the Central Bank carried out seasonal adjustment (a calculation that removes seasonal fluctuations from a time series to compare different periods). The indicator is considered a snapshot of the country’s GDP.
The IBC-Br incorporates growth estimates for the agricultural, industrial and services sectors. The calculation is carried out with seasonal adjustment, which allows different periods to be compared. It is one of the tools used by British Columbia to set the country’s base interest rate, Selic.
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GDP is the sum of all final goods and services produced by a country. An increase means that the economy is growing at a good rate, while a decline implies a decrease in the country’s economic output.
By productive sectors, agriculture recorded growth during the month, with an increase of 3.1%. Industry fell by 0.7% and services had a negative result of 0.2%.
Compared to October last year, the IBC-Br increased by 0.4%. In 12 months, the BC indicator increased by 2.5%. During the year, the so-called GDP overview recorded an expansion of 2.4%. All these variations were calculated without seasonal adjustment.
Analysis
According to André Valério, senior economist at Banco Inter, “the result attracts attention given the behavior of the sectoral statistics published by the IBGE, which show growth in the three main sectors”. “The IBC-Br nevertheless indicates a drop of 0.7% in industry and 0.2% in services,” he noted.
“The performance of the index was no longer negative due to the increase of 3.1% in the agricultural sector. Indeed, excluding agro-industry, the IBC-Br would have recorded a decrease of 0.3%,” underlines Valério.
For the economist, “the IBC-Br suggests the continuation of the accommodative trend in growth, a movement which is also observed in the IBGE data”. “This is happening despite the increases recorded in October, which reflect the lagged effects of restrictive monetary policy,” he specifies.
“Thus, the scenario points to an already consolidated slowdown in economic activity, but not intense enough to indicate a recession on the horizon. This deterioration, combined with recent disinflation, reinforces our expectation to see the Selic reductions begin in the first quarter, particularly at the January meeting,” adds Valério.
For Matheus Pizzani, economist at PicPay, these data “should intensify discussions on the next steps of monetary policy, because they go precisely against one of the pillars of the latest Copom declaration, which deals with the growth rate still considered positive by the institution”.
“Prospectively, in addition to the growth spasms generated by seasonal factors, the October situation is expected to be repeated during the last two months of 2025, consolidating the situation of accommodation of economic activity, with industry, especially in its transformation segment, which still evolves in a lateralized manner, and subgroups of the services sector more sensitive to economic cycles continuing the current slowdown,” he emphasizes.
The market reduces its estimate of inflation
Financial market analysts consulted by the BC reduced the inflation estimate for 2025. In relation to GDP, it was maintained. This is what the new edition of the Focus Report, published this Monday, shows.
According to the report, the Broad Consumer Price Index (PCAI), which measures the country’s official inflation, is expected to end this year at 4.36%, up from 4.40% the previous week. Compared to 2025 GDP, the projection was maintained at 2.25%.
According to the National Monetary Council (CMN), the inflation target for this year is 3%. As there is a tolerance margin of 1.5 percentage points upwards or downwards, the objective will be achieved if it remains between 1.5% and 4.5%.
Still according to Focus, Brazil’s GDP for 2025 is expected to grow by 2.25%, the same projection as last week.
For 2026, the economic growth forecast was maintained at 1.80%. For 2027, the estimate was reduced from 1.84% to 1.83%. In 2024, Brazilian GDP closed with an increase of 3.4%, according to data published by the Brazilian Institute of Geography and Statistics (IBGE).
Compared to the basic interest rate of the economy, the Selic, the financial market has maintained the estimate for the end of 2025 at 15% per year.
For 2026, the projection increased from 12.25% to 12.13% per year. For 2027, the market has maintained Selic’s estimate at 10.50% per year.
During the last meeting of the Monetary Policy Committee (Copom), the Selic was maintained at 15%. The next collegial meeting is scheduled for January 27 and 28.
Speech by Fed officials
Externally, investors’ attention continues to focus on the United States, awaiting “clues” on the trajectory of the base interest rate in the world’s largest economy.
This Monday, at least two leaders of the Federal Reserve (Fed) are expected to make statements: Stephen Miran, member of the board of governors of the North American Central Bank, and John C. Williams, president of the New York Fed.
Last week, at the Fed’s final Federal Open Market Committee (FOMC) meeting in 2025, the interest rate cut was 0.25 percentage points, in line with most market analysts’ projections. Today, interest rates are between 3.5% and 3.75% per year.
This is the third consecutive reduction in interest rates by the US Central Bank. At the previous Fed meeting in September, the drop was also 0.25 percentage points.
The vote was not unanimous. Stephen Miran voted for a larger cut of 0.5 percentage points, while Jeffrey R. Schmid and Austan D. Goolsbee voted to keep the interest rate unchanged.
The next meeting of the monetary authority to define the interest rate, the first in 2026, is scheduled for January 27 and 28.
Data from China
Another highlight of the international economic agenda at the start of the week is the publication of data on China. The Asian giant’s industrial production slowed in November to a 15-month low, while retail sales saw their worst result since the end of Covid-19 pandemic restrictions.
In China’s industry, production rose 4.8 percent last month from the previous month, according to data released by the National Bureau of Statistics (NBS). This is the slowest pace of growth in the industrial sector since August last year.
Retail sales rose 1.3% in November, the lowest rate since December 2022. Market analysts had forecast a much larger increase, of 2.8%.
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