A Morgan Stanley Brazil report warns against policy complacency before October's elections, sketching a bear case of a weaker currency and 18% long rates.
Brazil · ECONOMY
Key Facts
—What happened A Morgan Stanley Brazil report warned against complacency with current policy ahead of the October elections, Valor Econômico reported on 25 August 2026.
—How big The bear scenario puts the dollar at R$6 (US$1 = R$5.14), 10-year nominal rates near 18% and the Ibovespa at 130,000 points, a 25% drop.
—The catch The scenario applies only if no credible fiscal plan emerges after the elections.
Banco avalia que há pouco espaço para “complacência” com a continuidade da política econômica atual
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