> ## Content Index > Fetch the complete content index at: https://www.lacaribenanews.com/llms.txt > Use this file to discover other available public pages before exploring further. # Brazil Is Holding Its Rate at 13.75 Per Cent and Calls It Substantially Contractionary. The Minutes Say the Bank Will Not Respond to the Supply Shock Itself. - URL: https://www.lacaribenanews.com/brazil-copom-282-selic-13-75-first-round-supply-shock-2026/ - Published: 2026-11-11T04:33:17.000Z - Updated: 2026-11-11T04:33:18.000Z - Description: The Banco Central do Brasil published the minutes of its 282nd Copom meeting on 10 November 2026. The Selic rate stays at 13.75 per cent, which the Committee calls substantially contractionary. Inflation is above the tolerance ceiling, and the bank will not respond to a supply shock's first round. - Author: Theon Alleyne - Tags: Brazil, monetary policy, credit, banking, Caribbean, Business, Beat: economics **Quick summary:** The Banco Central do Brasil published the minutes of its 282nd Copom meeting on 10 November 2026\. The Selic rate stays at 13.75 per cent, which the Committee calls substantially contractionary. Inflation sits above the tolerance ceiling, and the minutes say the bank should not respond to the first-round effects of supply shocks. By LCN Business Desk The Banco Central do Brasil, Brazil's central bank, published the minutes of its 282nd monetary policy meeting on 10 November 2026, six days after the decision they record. One paragraph in them sets the bar for any future move, and it is set high in both directions. ## What did the Committee decide, and what did it signal? It kept the Selic rate at 13.75 per cent a year, and paragraph 16 of the minutes separates the shock from its echo. Copom held the meeting, its 282nd, on 3 and 4 November. [The statement went out on 4 November](https://www.bcb.gov.br/en/monetarypolicy/copomstatements?ref=lacaribenanews.com) and [the minutes followed on 10 November](https://www.bcb.gov.br/en/publications/copomminutes?ref=lacaribenanews.com), which is the document this week's reporting rests on. Seven members voted for the decision, Governor Gabriel Muricca Galípolo among them, and the minutes record no dissent. The Committee's word is "maintain", so the rate was already at 13.75 per cent going into the meeting. The minutes state no previous level and no direction of travel, so nothing here establishes whether this is a pause in a cutting cycle or a continuation of a hold. "Supply shocks have played a significant role in both the recent evolution of inflation and its prospective trajectory," the Committee writes. "Copom assesses that it should not respond to the first-round effects of such shocks but it is necessary to closely monitor potential second-round effects and to react decisively should those effects materialize." A first-round effect is the price of the thing that moved. A second-round effect is that price getting into wages, contracts and everything else. The Committee has said it will sit through the first and move hard on the second, which is why reporting of these minutes read as a high bar for a rate rise. It is equally a high bar for a cut, because paragraph 15 holds that "inflation is still being driven by demand, requiring monetary policy to remain tight". ## Which shocks is it declining to respond to? Oil, and the weather's effect on farming and power. The Committee lists its upside risks in order, and the first names "second-round effects stemming from supply shocks in oil and its derived products, and to climate effects upon agricultural productivity and energy costs". The external picture it gives for that is the prolongation of armed conflicts in the Middle East, pushing up oil and its derived products, alongside tighter monetary policy in advanced economies. So the bank has named climate damage to agricultural productivity as a supply shock, and said in the same document that it will not respond to the first-round effects of one. A farmer whose harvest failed is inside the shock the central bank is deliberately looking through. It is not a contradiction but the standard division of labour: a central bank treats a bad harvest as a relative price change and leaves the compensation to fiscal policy. Brazil is running the fiscal half concurrently. [Of the R$100 billion its government made available to the banks to renegotiate rural debt, about R$23 billion has been renegotiated, and the conversion bill approved on 10 November loosens the eligibility test rather than adding money](https://www.lacaribenanews.com/brazil-rural-debt-23-of-100-billion-eligibility-test-loosened-2026/). The two instruments reached the public on the same day. ## Where is inflation against the target? Above the tolerance ceiling, and the forecasts have moved the wrong way. | Measure | Position | | ----------------------------------------------- | ------------------------------------------------------------------- | | Headline and average core inflation | accelerated, above the upper limit of the target tolerance interval | | Focus survey expectations, 2026 | 5.2%, further from target than at the last meeting | | Focus survey expectations, 2027 | 4.8%, further from target than at the last meeting | | Copom projection, Q2 2028, the relevant horizon | raised to 3.5% | | Reference-scenario IPCA, 2026 / 2027 / Q2 2028 | 5.6% / 4.7% / 3.5% | | Administered prices, 2026 | 6.0% | | Reference-scenario starting exchange rate | USD/BRL 5.20 | Source: Banco Central do Brasil, minutes of the 282nd Copom meeting, 10 November 2026, and Table 1 of the same document. Two things in that table are worth holding together. The Committee's own projection for its relevant horizon rose rather than fell, and it says so while noting that the projection uses the Selic path taken from the Focus survey rather than its own intention. A forecast that drifts up on someone else's rate assumption is a weaker commitment than it looks. Administered prices are the outlier at 6.0 per cent, above both the headline and the market-price lines. Set by regulation rather than by demand, they are the part of the index a contractionary policy rate reaches last. ## What does the bank say its own rate is doing? Working, slowly, and already tight. The Committee describes the current scenario as "marked by a substantially contractionary Selic rate", and says the situation requires "serenity and cautiousness". Evidence of transmission to activity "has been gradually accumulating". Activity is moderating more sharply, particularly in cyclical sectors, and the labour market is resilient but slowing at the margin. Paragraph 5 puts a number on where that lands. Surveys of retail performance "indicate a turning point, particularly in the segments that are more sensitive to credit", which the Committee calls expected "in a context of a restrictive monetary policy". The bank is reporting the credit-sensitive part of the economy turning down as the intended consequence of its own stance. ## What does this mean for the Caribbean? That the region's largest neighbour has fixed the price of money at a restrictive level and told the market it will not move for an oil or weather shock. Brazil is not the Caribbean's central bank, but it is the price-setter the region's borrowers are compared against, and a 13.75 per cent policy rate held deliberately high is the backdrop against which Caribbean sovereigns and banks price their own paper. The regional contrast is in what a bank is paid for not lending. [Guyana's banks earn 7.85 per cent lending and 1.10 on government bills, and all six hold money abroad, where it pays about four times the home rate](https://www.lacaribenanews.com/guyana-banks-1-2-per-cent-government-paper-money-abroad-2026/). [A three-month Treasury bill pays a bank 1.10 per cent in Guyana and 6.43 in Jamaica, and banks in both countries buy more paper than they lend](https://www.lacaribenanews.com/guyana-jamaica-treasury-bill-yield-gap-banks-park-2026/). The division the minutes draw is the useful import. A supply shock in oil or in a harvest is a relative price change, and the instrument that answers it is fiscal or regulatory rather than monetary. Caribbean economies import both shocks wholesale. [Haiti buys every barrel it burns, and its central bank says an oil shock reaches the gourde before it reaches the pump](https://www.lacaribenanews.com/haiti-brh-oil-shock-reaches-the-gourde-before-the-pump-2026/), which is the same transmission question with no domestic production to cushion it. The asymmetry is the part a borrower feels. The Committee says its risks are higher than usual "with an upward asymmetry", meaning it is more worried about inflation surprising upwards than downwards, which is not a balance a rate cut is priced off. ### The entities \- **Banco Central do Brasil** published the statement on 4 November 2026 and the minutes on 10 November 2026\. - **Copom**, the Monetary Policy Committee, held its 282nd meeting on 3 and 4 November 2026\. - **Gabriel Muricca Galípolo** is Governor and voted for the decision. - **Selic** is the policy rate, held at 13.75 per cent a year. - **IPCA** is the consumer price index the projections are stated in. - **Focus survey** supplies the market expectations and the Selic path used in the reference scenario. ### What the title card says \- Headline: held at 13.75, and contractionary by its own account. - Deck: Brazil's Copom published the minutes of its 282nd meeting on 10 November, the Selic stays at 13.75 per cent, and the bank will not respond to the first-round effects of supply shocks. - Flag: Banco Central do Brasil, minutes published 10 November 2026\. - Selic rate: 13.75 per cent, maintained, seven members, no dissent recorded. - Paragraph 16, on the first-round effects of supply shocks: no response. - The same paragraph, on second-round effects if they materialise: react decisively. - Headline and core inflation, against the tolerance ceiling: above it, and accelerated. - Focus expectations for 2026 and 2027: 5.2 per cent and 4.8 per cent, both further from target. - Copom's own projection for the second quarter of 2028: 3.5 per cent, raised, on the Focus Selic path rather than its own. - The bank's word for its own rate, at paragraph 18: substantially contractionary. - Source note on the card: Banco Central do Brasil, minutes of the 282nd Copom meeting; the statement went out on 4 November. The minutes state no previous Selic level, so nothing on the card says the hold ended a cut. ## Frequently Asked Questions What is Brazil's policy interest rate? The Selic rate is 13.75 per cent a year. Copom maintained it at its 282nd meeting on 3 and 4 November 2026, and the minutes published on 10 November record seven members voting for the decision with no dissent. What does "should not respond to the first-round effects" mean? A first-round effect is the direct price rise caused by a shock, such as oil becoming dearer or a harvest failing. A second-round effect is that rise spreading into wages, contracts and other prices. Copom says it should not respond to the first and should react decisively to the second if it appears. Is Brazilian inflation within target? No. The minutes state that headline inflation and the average of underlying measures accelerated and sit above the upper limit of the target tolerance interval. Focus survey expectations for 2026 and 2027 moved further away from the target, to 5.2 per cent and 4.8 per cent. Has the rate been cut or raised? The minutes record a decision to maintain the rate and state no previous level or direction, so this document alone does not establish whether the hold follows cuts or a longer pause. What does the bank say about credit? Paragraph 5 of the minutes says surveys of retail performance indicate a turning point, particularly in the segments more sensitive to credit, and that this is expected in a context of restrictive monetary policy.