A customer buys goods at a supermarket in Sao Paulo, Brazil, March 18, 2020. (Photo by Rahel Patrasso/Xinhua)

 
Brazil's financial market raised its inflation forecast for both this year and the next, from 5.39 percent to 5.48 percent in 2023 and from 3.7 percent to 3.84 percent in 2024, the Central Bank of Brazil said Monday.

Target inflation for 2023 has been set at 3.25 percent and at 3 percent for 2024, with a 1.5 percentage point margin of tolerance in both cases.

According to the bank's weekly survey of the country's leading financial institutions, analysts maintained their forecast for the benchmark interest rate (known as Selic in Brazil) at 12.5 percent by the end of the year, down from the current 13.75 percent annually. The rate is expected to then gradually decline to close 2024 at 9.5 percent.

Analysts slightly upgraded their economic growth forecast for 2023 from a 0.77 percent to a 0.79 percent expansion in gross domestic product (GDP), but maintained their forecast for 2024 at 1.5 percent.

Brazil's currency, which currently trades at 5.21 reals to the US dollar, is forecast to devalue slightly to 5.28 to the dollar by the end of 2023 and to 5.3 to the dollar in 2024.

Foreign direct investment in Brazil should reach 80 billion US dollars this year and 77.5 billion US dollars in 2024.