Usdbrl: Facing A Higher-For-Longer World

UBS maintains its USDBRL forecast targets while highlighting rising fiscal and political risks for Brazil. The firm notes that the BCB's easing cycle is likely facing a pause due to persistent inflation and resilient economic growth.

Key Takeaways

• 1.UBS maintains USDBRL targets of 5.00 for 3Q26, 5.10 for 4Q26, 5.20 for 1Q27, and 5.30 for 2Q27.
• 2.Brazil's Central Bank (BCB) easing cycle is under pressure due to resilient economic activity and persistent inflation, leading to expectations of a pause.

Table of Contents

• Key drivers
• Appendix
• Risk information
• Generic investment research – Risk information

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