Brazil interest rates fall amid lower oil prices and inflation expectations

Brazilian future interest rates experienced a significant decline on Tuesday, driven by international market trends and domestic inflation expectations. Investors are positioning themselves ahead of the IPCA-15 report, which is expected to show deflation.

External factors played a major role, including a sharp drop in oil prices—with Brent falling below $90 per barrel—and a decline in U.S. Treasury yields. The movement in the energy market was influenced by optimism regarding potential peace negotiations between the United States and Iran, as well as reports of progress in talks involving Pakistan.

Domestically, the Weekly Consumer Price Index (IPC-S) for the third four-week period of August fell by 0.39%, according to FGV Ibre. While the index shows a 12-month accumulation of 3.91%, various expenditure groups showed mixed results, with diverse expenses seeing acceleration while education and communication saw declines.