Copom starts fifth meeting of 2026, assesses new Selic cut

The Central Bank's Monetary Policy Committee kicked off, on Tuesday, the fifth meeting of the year, in a scenario marked by expectations of further cuts to the benchmark interest rate and by inflation still above the upper limit of the target.

Copom starts meeting amid expectations of new cuts

The decision on the Selic will be announced on Wednesday night, after two days of debate on the national and international economic situation.

Selic at 14.25%: history of recent reductions

Currently, the benchmark rate stands at 14.25% per year, the lowest level recorded in 2026, resulting from three successive reductions of 0.25 percentage points in the March, April and June meetings.

Focus Bulletin signals drop in rate projections

On the eve of the meeting, the Focus Bulletin released on August 3, 2026, showed that the median market expectations for the Selic by year-end fell from 14% to 13.75% after five weeks of stability.

Inflation still projected above the 3% target

Analysts consulted by the Central Bank also lowered, for the fifth consecutive week, the projection for the Broad Consumer Price Index (IPCA) for 2026, moving from 5.12% to 5.03%. Despite the decline, the estimate remains above the 4.5% ceiling set by the National Monetary Council.

How Selic variations affect consumers and banks

The Selic serves as a reference for public securities and for other rates in the economy, being the main tool for inflation control. When the Copom raises the rate, credit becomes more expensive, which tends to reduce demand and curb price pressures. Conversely, hikes can slow economic expansion. A reduction in the Selic usually makes credit cheaper, stimulating consumption, investment and economic activity. Banks, when setting the interest charged to customers, also consider default risk, administrative costs and profit margins.

With information from Agência Brasil.