{"id":93607,"date":"2025-04-04T16:14:50","date_gmt":"2025-04-04T19:14:50","guid":{"rendered":"https:\/\/murray.adv.br\/?p=93607"},"modified":"2025-04-04T16:14:52","modified_gmt":"2025-04-04T19:14:52","slug":"u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025","status":"publish","type":"post","link":"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/","title":{"rendered":"U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025"},"content":{"rendered":"\n<h6 class=\"wp-block-heading has-text-align-center\"><em><strong>Economists see inflation closer to 5% than 5.5%; Treasury yields fall<\/strong><\/em><\/h6>\n\n\n\n<p><\/p>\n\n\n\n<p><\/p>\n\n\n\n<p><\/p>\n\n\n\n<p><\/p>\n\n\n\n<p>04\/04\/2025 <\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\" \/>\n\n\n\n<p>The&nbsp;<a class=\"\" href=\"https:\/\/valorinternational.globo.com\/economy\/news\/2025\/04\/03\/trump-imposes-10percent-tariff-on-brazil-lowest-rate-in-new-trade-offensive.ghtml\">sweeping global tariffs announced on Wednesday (2) by U.S. President Donald Trump<\/a>\u2014on what he dubbed \u201cLiberation Day\u201d\u2014may create&nbsp;<strong>downward pressure on Brazil\u2019s inflation outlook<\/strong>&nbsp;for this year. Economists now see inflation numbers hovering around 5%, rather than above 5.5%. The median projection in the Central Bank\u2019s Focus survey currently points to an IPCA official inflation rate of 5.65% in 2025 and 4.5% in 2026.<\/p>\n\n\n\n<p>Inflation expectations embedded in NTN-B bonds (Brazilian Treasury notes indexed to the IPCA) due in May 2025 fell to 5.64% on Thursday, from 5.96% the day before, 6.48% five days ago, and 9.83% a month ago, according to Warren Rena. For NTN-Bs maturing in August 2026, implied inflation fell to 4.95%, down from 5.27%, 5.42%, and 6.26% over the same periods.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a class=\"\" href=\"https:\/\/valorinternational.globo.com\/markets\/news\/2025\/04\/04\/market-sees-lower-interest-rates-ahead-on-us-risk-trade-tensions.ghtml\"><strong>Market sees lower interest rates ahead on U.S. risk, trade tensions<\/strong><\/a><\/li>\n<\/ul>\n\n\n\n<p>Despite the downward bias, projections remain above the upper limit of the inflation target, set at 4.5%. Brazil was less affected by the newly announced tariffs, as its products will face a 10% surcharge\u2014the minimum rate imposed by the Trump administration.<\/p>\n\n\n\n<p>If the situation remains as it is, the measure could result in higher inflation in the U.S., slower growth there, and a broader global economic slowdown, said Andr\u00e9a Angelo, chief inflation strategist at Warren. These effects, she noted, could weaken the U.S. dollar, easing inflationary pressure on goods in Brazil.<\/p>\n\n\n\n<p>Ms. Angelo pointed out that when the real strengthens against the dollar, the pass-through to consumer prices tends to be smaller than when the Brazilian currency depreciates. Still, an exchange rate of R$5.50 to the dollar, for example, could reduce Brazil\u2019s goods inflation and lead to a 0.27 percentage point drop in the IPCA, bringing the projection to 5.2%. On Thursday, the dollar\u2019s exchange rate closed at R$5.62. \u201cThere\u2019s also the possibility that Asia will face a glut of goods, since it won\u2019t be exporting as much to the U.S.,\u201d she added.<\/p>\n\n\n\n<p><strong>Inflation risks<\/strong><\/p>\n\n\n\n<p>Mirella Hirakawa, head of research at Buysidebrazil, said that inflation risks for 2025, which had been tilted to the upside, now appear more evenly balanced. The consultancy had already projected a lower inflation rate for 2025 than the market consensus, with a year-end IPCA of 5.2%. Last week, the forecast was revised upward to 5.4%, and the 2026 projection increased from 4.4% to 4.6%.<\/p>\n\n\n\n<p>\u201cI think that for 2025, we and the market will likely meet halfway\u2014somewhere between 5.4% and 5.5%. But for 2026, the projections shouldn\u2019t change much,\u201d Ms. Hirakawa said. She noted that the estimates do not yet factor in the impact of private payroll-deductible credit in 2025 or the income tax reform scheduled for 2026.<\/p>\n\n\n\n<p>She said Thursday\u2019s drop in Brazil\u2019s exchange and interest rate markets reflects the relatively limited impact of the U.S. tariffs on Brazil, combined with a higher risk of recession in the U.S. than of global price pressure. \u201cBut we\u2019re talking about a potential new world order, with a high degree of uncertainty around the new map of trade agreements.\u201d<\/p>\n\n\n\n<p>She sees two possible scenarios: one where all countries reduce tariffs and economies become more open\u2014including the U.S.; and another where nations retaliate against the U.S. and forge new trade deals among themselves, with the U.S. left out.<\/p>\n\n\n\n<p>\u201cIn my view, regardless of the scenario, the U.S. will feel the inflationary effects before any hard data on activity. Initially, uncertainty will play a larger role in the slowdown, but the most significant impact would come in the second half of the year, possibly reinforcing fears of a recession\u2014which could become a self-fulfilling prophecy,\u201d she said.<\/p>\n\n\n\n<p>The Trump administration\u2019s tariff hike could trigger responses from other trade partners, potentially sparking a trade war that would hurt the global economy. Still, Brazil stands to lose less than other countries, said Iana Ferr\u00e3o, economist at BTG Pactual. The extent of that loss, however, will depend on how much the global economy deteriorates, she noted.<\/p>\n\n\n\n<p><strong>\u2018Impoverishment Day\u2019<\/strong><\/p>\n\n\n\n<p>Sergio Vale, chief economist at MB Associados, called \u201cLiberation Day\u201d an \u201cImpoverishment Day,\u201d saying it would \u201cshackle the American population to much higher prices.\u201d For Brazil, he said, the announcement strengthened the country\u2019s growing alignment with China and bolstered commodity trade chains. The relatively mild tariff rate imposed on Brazil helped strengthen the real through expectations of an improved trade balance, he added.<\/p>\n\n\n\n<p>\u201cThe idea of a stronger trade balance with China and other countries, combined with accelerated progress on trade deals with Europe, for example, should help keep the exchange rate lower in the coming months. As a result, the real is likely to remain around R$5.70 throughout 2025,\u201d Mr. Vale said.<\/p>\n\n\n\n<p>This stronger exchange rate supports MB\u2019s IPCA estimate of 5.1% for 2025 and helps push inflation away\u2014for now\u2014from levels above 5.5%, he said. \u201cStill, both this year and next, when we expect 4.5%, inflation is likely to end President Lula\u2019s term near the upper limit of the target range.\u201d<\/p>\n\n\n\n<p>The combination of a stronger real, moderate global slowdown risk, and a possible increase in oil supply in May, as announced by OPEC+, led Banco Pine to lower its 2025 IPCA forecast from 5.25% to 5.1%. \u201cGiven our outlook for the domestic and global economy, we feel relatively comfortable with this projection,\u201d said Cristiano Oliveira, head of economic research.<\/p>\n\n\n\n<p>XP expects some recovery in commodity prices and the U.S. Dollar Index (DXY) in the coming weeks, despite the high level of uncertainty. It also does not anticipate a near-term interest rate cut from the Federal Reserve. As a result, XP maintained its exchange rate forecast at R$6 to the dollar at the end of 2025 and R$6.20 in 2026. Still, the brokerage acknowledged that the probability of stronger Latin American currencies\u2014beneficial for inflation and monetary policy\u2014has increased.<\/p>\n\n\n\n<p>XP also lowered its 2024 goods inflation forecast from 4.7% to 4.3%, driven by first-quarter currency gains. However, it now assumes a yellow flag for electricity tariffs in December, with an additional surcharge. This kept its 2025 IPCA forecast at 6%. For 2026, the forecast rose from 4.5% to 4.7% due to the expected impact of income tax reform.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>By\u00a0Ana\u00efs Fernandes <strong>\u2014 S\u00e3o Paulo<\/strong><\/li>\n\n\n\n<li>Source: Valor International<\/li>\n\n\n\n<li>https:\/\/valorinternational.globo.com\/<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Economists see inflation closer to 5% than 5.5%; Treasury yields fall 04\/04\/2025 The&nbsp;sweeping global tariffs announced on Wednesday (2) by U.S. President Donald Trump\u2014on what he dubbed \u201cLiberation Day\u201d\u2014may create&nbsp;downward pressure on Brazil\u2019s inflation outlook&nbsp;for this year. Economists now see inflation numbers hovering around 5%, rather than above 5.5%. The median projection in the Central [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8106],"tags":[26003,26002],"class_list":["post-93607","post","type-post","status-publish","format-standard","hentry","category-murray-news","tag-economists-see-inflation-closer-to-5","tag-u-s-tariff-hike"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025 - Murray Advogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025 - Murray Advogados\" \/>\n<meta property=\"og:description\" content=\"Economists see inflation closer to 5% than 5.5%; Treasury yields fall 04\/04\/2025 The&nbsp;sweeping global tariffs announced on Wednesday (2) by U.S. President Donald Trump\u2014on what he dubbed \u201cLiberation Day\u201d\u2014may create&nbsp;downward pressure on Brazil\u2019s inflation outlook&nbsp;for this year. Economists now see inflation numbers hovering around 5%, rather than above 5.5%. The median projection in the Central [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/\" \/>\n<meta property=\"og:site_name\" content=\"Murray Advogados\" \/>\n<meta property=\"article:published_time\" content=\"2025-04-04T19:14:50+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-04-04T19:14:52+00:00\" \/>\n<meta name=\"author\" content=\"Gelcy Bueno\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Gelcy Bueno\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/\"},\"author\":{\"name\":\"Gelcy Bueno\",\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e\"},\"headline\":\"U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025\",\"datePublished\":\"2025-04-04T19:14:50+00:00\",\"dateModified\":\"2025-04-04T19:14:52+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/\"},\"wordCount\":1033,\"keywords\":[\"Economists see inflation closer to 5%\",\"U.S. tariff hike\"],\"articleSection\":[\"Murray News\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/\",\"url\":\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/\",\"name\":\"U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025 - Murray Advogados\",\"isPartOf\":{\"@id\":\"https:\/\/murray.adv.br\/en\/#website\"},\"datePublished\":\"2025-04-04T19:14:50+00:00\",\"dateModified\":\"2025-04-04T19:14:52+00:00\",\"author\":{\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e\"},\"breadcrumb\":{\"@id\":\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"In\u00edcio\",\"item\":\"https:\/\/murray.adv.br\/en\/home\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/murray.adv.br\/en\/#website\",\"url\":\"https:\/\/murray.adv.br\/en\/\",\"name\":\"Murray Advogados\",\"description\":\"PLG International Lawyers\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/murray.adv.br\/en\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e\",\"name\":\"Gelcy Bueno\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/1ef2acfe966d6deacdeccd2a24ea89192c41fd05fc60e57b79021358a47f5641?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/1ef2acfe966d6deacdeccd2a24ea89192c41fd05fc60e57b79021358a47f5641?s=96&d=mm&r=g\",\"caption\":\"Gelcy Bueno\"},\"url\":\"https:\/\/murray.adv.br\/en\/author\/news\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025 - Murray Advogados","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/murray.adv.br\/en\/u-s-tariff-hike-could-ease-brazils-inflation-outlook-for-2025\/","og_locale":"en_US","og_type":"article","og_title":"U.S. tariff hike could ease Brazil\u2019s inflation outlook for 2025 - Murray Advogados","og_description":"Economists see inflation closer to 5% than 5.5%; Treasury yields fall 04\/04\/2025 The&nbsp;sweeping global tariffs announced on Wednesday (2) by U.S. President Donald Trump\u2014on what he dubbed \u201cLiberation Day\u201d\u2014may create&nbsp;downward pressure on Brazil\u2019s inflation outlook&nbsp;for this year. 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