Will the Bank of Brazil decrease the target for the Selic rate by 25 bps at the September meeting?

Analysis

Copom has cut the Selic rate four straight meetings, taking it from 14.25% to 14.00% in August 2026. Inflation has cooperated, settling back inside the target band at 4.44%. A cooling labor market has stayed firm without reigniting price pressure. Softer global oil prices add further room. Together, these conditions describe exactly the setup that keeps an easing cycle intact rather than interrupting it. The committee did not pre-commit after the August meeting, saying it would watch incoming data. That is standard hedging language for a data-dependent path, not a signal of hesitation. Full-year inflation forecasts near 5% and elevated US Treasury yields are the honest counterweights. They are enough to keep a hold as the real alternative scenario. Still, nothing in the recent data flow has broken the sequence. Four consecutive quarter-point moves is a hard pattern to interrupt just six weeks after the last one. A jumbo 50 basis point cut has little support in the evidence. The disciplined, measured pace argues for another 25. Most of the remaining uncertainty sits with a pause rather than any larger or reversed move. The one thing to watch is the August inflation print, due before the meeting scheduled ahead of the 15 September 2026 deadline. A clear upside surprise, particularly in services, is the one realistic path that knocks Copom off its established quarter-point cadence.