Recent upward revisions to Brazil’s 2026 IPCA forecasts following President Lula’s reelection have positioned the 5.00-5.49% range as the leading market-implied outcome. Economist medians in the Central Bank’s Focus survey now stand at 5.22% for year-end 2026, above the 4.5% target ceiling, while Copom’s reference scenario projects 5.6%. Persistent pressures from food prices, oil shocks, a weaker real, and de-anchoring of longer-term expectations prompted the Selic pause at 13.75% in early November. October’s 4.63% 12-month reading came in softer than expected yet remains above target, reinforcing trader views that fiscal uncertainty and supply-side risks will keep inflation in the mid-5% area absent further policy tightening or reform.