April, 2024

2024 Spring Meetings

Economic Outlook and

Agenda BC#

Roberto Campos Neto

Governor of the Banco Central do Brasil
 2
INFLATION
Global Economy Global inflation
Decline in global inflation remains, but with debates about the speed of disinflation in many countries.

Global inflation Advanced economies Emerging markets

(% YoY) (% YoY) (% YoY)
10 9
10
8

8 8
7

6
6 6
5

4 4 4

3
2 2
2

1
0 0
0

-2 -2 -1
Apr-20

Oct-22
Mar-23
Jun-19

Jul-21
Jan-19

Aug-23
Jan-24
Dec-21
May-22
Nov-19

Sep-20
Feb-21
Apr-20

Oct-22
Mar-23
Jan-19
Jun-19

Jan-24
Jul-21

Aug-23
Dec-21
May-22
Nov-19

Sep-20
Feb-21

Jan-19

Apr-20

Oct-22
Jun-19

Jul-21

Mar-23
Aug-23
Jan-24
Dec-21
May-22
Nov-19

Sep-20
Feb-21
*Corresponds to 66% of global GDP except China
Sources: Bloomberg, Refinitiv, central banks, national statistics institutes. Countries: DE, FR, GB, IT, BE, NE, IE, SP,CH, NO, SE, DK, FI, CA, US, JP, BR, MX, CL, CO, IN, NR, ZA, BG, CZ, HU, PL, RO, SK.
 3
INFLATION
Global Economy AEs: inflation
Core inflation remains declining, but levels are still high. Services inflation slowly decelerating.

AEs: headline inflation AEs: core inflation AEs: services CPI

(% YoY) (% YoY) (% YoY)
12 8 8

US US
US
Euro Area Euro Area
Euro Area
10 Japan 6 UK
UK
UK 6 Japan
Japan
Australia
Australia Australia
8 Canada
Canada Canada 4

4
6
2

4 2
0

2
0
-2

0
2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

-2 -4
2018

2023
2014

2015

2016

2017

2019

2020

2021

2022

2024

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024
-2

Source: Bloomberg.
 4
INFLATION
Global Economy EMEs: inflation
Core inflation remains declining, but levels are still high. Services inflation slowly decelerating.
EMEs: headline inflation EMEs: core inflation EMEs: services CPI
(% YoY) (% YoY) (% YoY)
15 15
15 Brazil
Brazil Brazil
Chile
Chile Chile
13 Mexico 13
13 Mexico Mexico
Colombia
Colombia Colombia
India
India 11 11 India
11 South Africa South Africa
South Africa China China
China 9
9 9

7 7 7

5 5 5

3 3 3

1 1 1

-1 -1 -1

2017
2014

2015

2016

2018

2019

2020

2021

2022

2023

2024
2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024
2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

Source: Bloomberg.
 5
INFLATION
Global Economy US: inflation
Core inflation continues with gradual deceleration. Services inflation remains resilient.

CPI: US headline and core 12 45 2 15

CPI US core goods

CPI US energy
(% YoY) 30
6 10
10 1
15

% YoY
% MoM
% YoY
% MoM
0 5
0
0
8 US Headline CPI -6 0
-15

US Core CPI ex food -12 -30 -1 -5

and energy Mar-21 Dec-21 Sep-22 Jun-23 Mar-24 Mar-21 Dec-21 Sep-22 Jun-23 Mar-24
6 MoM Average 14-19 YoY
MoM Average 14-19 YoY

0.9 8 Primary

CPI US core services

1.0 1.5

Rent CPI and Zillow index

OER
4
3.8 0.6 6 Zillow (RHS.;MA12M, +6M)
0.8 1.2

% MoM
3.5

% YoY
0.3 4
0.6 0.9
2
0.0 2 0.4 0.6
-0.3 0 0.2 0.3
Mar-21 Dec-21 Sep-22 Jun-23 Mar-24
0
0.0 0.0
2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

MoM Average 14-19 YoY Sep-18 Sep-20 Sep-22 Sep-24

-2 Dotted lines: Estimate (OLS CPI vs Zillow (+6M;MA12M))

Source: Bloomberg, BEA.

 6
MONETARY POLICY
Global Economy Monetary policy
The global environment remains volatile, with debates about the beginning of the easing cycle in major economies.
Advanced economies
6 Monetary policy pricing
5 MONETARY POLICY PRICING
Interest rates and market expectations (%)

4 04/17/2024
Country Interval of monetary policy rate
Rate (%) Pricing 6 Mounths Pricing 1 Year
3 Since 2008 vs. Current rate
last decision base points base points

2 AEs
US
1 US 5.38 -25 -63 0.13 0.10 -0.03
CANADA
Canada 5.00 -51 -87 0.25 0.26 0.01
0 EURO
Euro area 4.00 -62 -106
-1 UK 5.25 -30 -66 UK
2017 2018 2019 2020 2021 2022 2023 2024 Australia 4.35 -9 -27 AUSTRALIA

BoE RBNZ BoC FED RBA ECB New Zealand 5.50 -15 -61 NEW ZEALAND

Japan 0.10 +17 +32 JAPAN

Latin America
14 EMEs
Mexico 11.00 -35 -98 MEXICO
5.5 4.31 -1.19
12
Chile 6.50 -74 -106 CHILE
0.5 0.43 -0.07
10
Brazil 10.75 -23 +19 BRAZIL 3 3.83 0.83
8
Colombia 12.25 -173 -316 2.75
COLOMBIA 2.38 -0.37
6 Russia 16.00 -131 -94 5.5
RUSSIA 4.39 -1.11
4 South Africa 8.25 -5 -6 3.75 3.73 -0.02
SOUTH AFRICA
2 China 1.80 -1 -8 1.80
CHINA 2.21 0.41

0 India 6.50 +9 -4 4.00

INDIA 3.63 -0.37
2017 2018 2019 2020 2021 2022 2023 2024 Korea 3.50 -3 -4 KOREA

Brazil Colombia Mexico Chile -3 0 3 6 9 12 15 18 21

Sources: Bloomberg, central banks, BCB.

 7
MONETARY POLICY
Global Economy US: monetary policy
Fed funds rate kept between 5.25%-5.5% at March meeting, as expected.
-1
DOTS 2024 (Dec/23 = Mar/24): 3 cuts -1.6
Fed Funds terminal rates (future curves) -2
5.5%

Dec/2024 contracts
FF rate cuts
-3
NFP
-4 Exp.: 185k ∆ = -5.1 cuts
Act.: 353k
5.0% -5 CPI Core
Exp.: 3,7%
-6 Act.: 3,9%
DOTS 2024: 4.625% -6.7
-7
4.5% 2-Jan 16-Jan 30-Jan 13-Feb 27-Feb 12-Mar 26-Mar 9-Apr
Current

Sep 20th 5.5

level for the FF, percentual, March 2024)

(midpoint of the target range or target
Nov 1st.
4.0% 5.0
DOTS 2025: 3.875%
Mar 19th

Fed’s dot plot

Jul 26th 4.5
Jun 14th
4.0
3.5%
3.5

3.0
3.0%
Aug-23 Jan-24 May-24 Oct-24 Feb-25 Jul-25 Nov-25 2.5

Sources: Bloomberg, Fed. 2024 2025 2026 Longer run

 8
ACTIVITY
Global Economy Global economic activity
Global economic activity has been resilient. Recent economic data continues to surprise to the upside.

Real GDP growth PMI: manufacturing and services Growth surprise index
(% YoY) 55.0 200
3.0 8.0
150
52.5
6.0 100
2.0

50.0 50
4.0

1.0 0
2.0 47.5
-50

0.0 0.0 45.0 -100

Manufacturing

Services

Manufacturing

Services
US EU JP GB CN IN BR MX
-150

Jul-22

Jul-23
Nov-22

Jan-23

Nov-23

Jan-24
Sep-22

Mar-23

Sep-23

Mar-24
May-23
-1.0

AEs EMEs Global Emerging markets

Realised, 2023 Forecasts for 2023 Euro area US
Feb 24 Oct 23
made in Dec 2022 United Kingdom China

Sources: BIS, Bloomberg.

 9
ACTIVITY
Global Economy Global economic activity
There is a debate whether the resilience of global activity is related to changes in neutral interest rates and potential productivity shocks.

S&P 500: performance

term-premium models

94.3%
r* estimates based on

Mag 7

(Accumulated returns, %)
75

50
33.2%
S&P 500
25
17.3%
S&P 493
0
2023:01 2023:07 2024:01

250% 239%
r*: Statistical uncertainty

194%

(Accumulated returns in 2023)

Mag 7: performance
200%
around estimates

150%
102%
100% 81%
58% 57%
48%
50% S&P500
24%

0%
nvidia meta tesla amazon alphabet microsoft apple
HLW = Holston et al (2023); LM = Lubik and Matthes (2015).
Fontes: Bloomberg, Benigno, G. et al., Quo vadis, r*? The natural rate of interest after the pandemic, 2024.
 10
ACTIVITY
Global Economy US: economic activity
Economic activity has been resilient, supported mainly by consumption. Investments impacted by contractionary pressures.

GDP and contributions 1 Real consumption per components

Fixed capital formation

(% QoQ seas. adj., p.p.) 145 (Index 2009 = 100) 250
6

(% QoQ seas.adj., p.p.)

0
5 4.9
-1 220
135
4
3.3
2.7 -2
3 2.6 190
2.2 2022Q2 2022Q4 2023Q2 2023Q4
2 2.1 Intel. property Equipment 125
Structures Residential
Fixed invest. (ex inventories) 160
1
3.0
0
GDP growth projection 2024 115 Non durables
2.5 2025
-0.6 2.2 130
-1 2.0 Services
1.7
(% YoY)

1.5
-2 105 Durables
1.0 100
-3 Personal consumption Fixed investment
0.5
Inventories Net exports
-4 Government 0.0 95
* Dotted lines: trend 2009-19
70
2022Q2 2022Q4 2023Q2 2023Q4 Apr-23 Jul-23 Oct-23 Jan-24 Apr-24 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 Jan-24

Source: Bloomberg.
 11
ACTIVITY
Global Economy US: economic activity
Savings and generational effects have been important drivers for consumption.
Disposable income and savings Consumer spending Share of wealth held by
(US$ trillion, at Jan/24 prices) by age group adults 70 years and older
% % 27
24 Disposable income 8 26

Savings 26
23 7
24
25
22 6
22
24
21 Trend 5
20 23
20 4
22
18
19 3
21
18 2 16
20

17 1 14 19

16 0 18
12
Jan-17 Jan-18 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23 Jan-24
2005 2010 2015 2020 1990 2000 2010 2020

Sources: Bloomberg, Refinitiv, Liberty Street Economics, WSJ, Labor Department, Survey of Consumer Expectations.
 12
ACTIVITY
Global Economy China: economic activity
Real estate and construction sectors still affect negatively China’s economic performance.
140 20
Services (ex real estate)

real estate development

GDP and its sectors
(2019=100, seas. adj)

130 10
Agriculture and industry

(accumulated YoY, %)
Investment in
120 0
Total GDP
-10
110
Real estate and construction -20 Under construction
100
New starts
-30
90 Building complete
-40
2018 2019 2020 2021 2022 2023 Dec/2019 Dec/2020 Dec/2021 Dec/2022 Dec/2023 Feb/2024
12 140

Residencial real estate:

sales, starts and prices
10 8.0 10.6 GDP growth 120
GDP and target

9.7 9.4 9.6 Target 6.0

7.5 100

(Dec 2018 = 100)

8 7.0 8.4
6.5
7.9 7.8 7.4 6.0
80
(%)

7.0 5.5
6 6.8 6.9 6.7 5.0 5.0
6.0
5.2 60
4
40
2 3.0
2.2
20
0
0
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024

2018 2019 2020 2021 2022 2023

Sources: Gavekal, IMF, China StateCouncil, NBS.
 13
MARKETS
Global Economy US: financial markets
Stock market at highest, despite increases in yields.

10-year Treasury S&P 500

Difference to maximum level in the Tsy10y (b.p.)

0 30%

Standardized return from maximum Tsy10y

20%
-100

10%
-200
0%

-300
-10%

-400 -20%

-100 -50 0 50 100 150 200 250 -100 -50 0 50 100 150 200 250
Working days from Tsy10y maximum Working days from Tsy10y maximum
1984 cycle 1994 cycle 2006 cycle 2023 cycle 1984 cycle 1994 cycle 2006 cycle 2023 cycle
1999 cycle 2000 cycle 2018 cycle 1999 cycle 2000 cycle 2018 cycle

Source: Bloomberg.
 14
MARKETS
U.S. US: money markets
Flows to money market funds remain positive. Despite the recent contraction, U.S. remains with excess of money.

6,000,000 30
Total money-market

5,750,000
25
5,500,000
20
fund assets
(US$ million)

5,250,000

(YoY % )
15

M2
5,000,000

4,750,000 10 Average 2010-2019

4,500,000 5
4,250,000 0
4,000,000
Apr-22 Aug-22 Dec-22 Apr-23 Aug-23 Dec-23 Feb-24
-5

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

3.0
Feds’s reverse repo facility

23
2.5 20

(US$ trillions)
(US$ trillions )

2.0 18

M2
1.5 15
Trend 2010-2019
13
1.0
10
0.5
8
0.0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
2019 2020 2021 2022 2023 2024
Source: Gavekal.
 15
FISCAL POLICY
Global Economy Fiscal policy: public debt and debt service
Rising public debt and debt service burden demand increasing resources.

US: Public debt Country groups: Public debt Country groups: US: Net issuance
(% of GDP) (% of GDP) Interest payments (1 ycma, gray: US recessions,
(Estimates, % of revenues) US$ trillion)
Global
200 Covid-19 11
130 financial 6
crisis Advanced
9 Emerging
Forecast
5
160
110 Advanced 7
US Treasury, government
4
Forecast Emerging agencies and municipal bonds
5

2008
2010
2012
2014
2016
2018
2020
2022
2024
2026
2028
120
90 3

US: Interest payments

97.3 8 (Estimates, % of revenues) 2
80 70 7
CBO Estimates (June 2023)
6 CBO Estimates (March 2024) 1
5
40 50 4 0
Forecast
3 US corporate equities and bonds
2 -1
0 30 1
1980 1985 1990 1995 2000 2005 2010 2015 2020
1995

2023
1991

1999
2003
2007
2011
2015
2019

2027

2004
2009
2014
2019
2024
2029
2034
2039
2044
2049
2054
1964
1974
1984
1994
2004
2014
2024
2034
2044
2054

Sources: CBO, IMF, Gavekal

 16
RISKS
Global Economy Risks for global economy
Inflation returns as the main source of risk for the global economy. US Commercial real estate is the most likely source for a systemic credit event.

Tail risks (%) Sources of credit systemic risk (%)

What do you consider the biggest ‘tail risk’? What is the most likely source for a systemic credit event?

Higher inflation US commercial real estate

Geopolitics US shadow banking

(e.g., private credit)
Economic hard landing
China real estate
US election
Mar-24 Mar-24
Mar-24
US government debt
Febr-24
Feb-24
Systemic credit event
Feb-24 Jan-24
Jan-24
Emerging markets
China banking crisis Jan-24

0 5 10 15 20 25 30 35 0 5 10 15 20 25 30 35 40 45

Sources: BofA Global Fund Manager Survey

 17
INFLATION
Brazil
Brazil: inflation
Headline consumer inflation remains in a path of disinflation. March figures slightly softer.
Volatile components
21
13
IPCA and target
18
(YoY %)
15
12 12
IPCA
11 9
Average of core measures 6.4
6
10 3.9
Target 3 2.5
0
9 -3

CPI components
8 -6
Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23 Mar-24

(YoY %)
7 IPCA Administered prices Food at home

6 Cyclical components
15
5
12
4 3.9
3.8 9
3
6
2 5.1
3 3.9
1
0 0.5
0
Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23 Mar-24 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23 Mar-24
IPCA Industrial goods Services
Sources: IBGE, BCB
 18
INFLATION
Brazil
Brazil: core inflation
Core inflation by segments slightly higher in latest readings. Underlying services relatively stable but at still high levels.

Core food-at-home Core industrial goods Underlying services

(%) (%) (%)
25 20 14

12
20
15
10
15
10
8
10
6
5
5
4
0
0 2

-5 -5 0
2020
2017

2018

2019

2021

2022

2023

2024

2019

2022
2017

2018

2020

2021

2023

2024
2018

2024
2017

2019

2020

2021

2022

2023
Sources: IBGE, BCB
 19
INFLATION
Brazil
Brazil: services inflation
Services inflation shows more resilience in items linked to the labor market.

Inertia-sensitive services * Slack-sensitive services* Labor-intensive services

(%) (%) (%)
12 12 12

10 10 10

8 8 8

6 6 6

4 4 4

2 2 2

0 0 0

-2 -2 -2
2020
2017

2018

2019

2021

2022

2023

2024

2019

2022
2017

2018

2020

2021

2023

2024
2018

2024
2017

2019

2020

2021

2022

2023
Sources: IBGE, BCB * Inflation Report box "Analysis of the services inflation considering slack and inertia", December 2022
 20
INFLATION
Brazil
Brazil: inflation expectations
Long-term inflation expectations remain unanchored.

Inflation expectations Break-even inflation

(YoY %, Focus Report*, median) (DAP, YoY %)
7.5 Target confirmation
4.2 Target confirmation
7.0
4.0
6.5
3.8 6.0
3.71
5.5
3.6 3.56 5.21
3.50 5.0 4.89
3.4 4.5
4.0 4.09
3.2
3.5
3.0
3.0
2.8 2.5

2024 2025 2026 CMN Meeting 2024 2025 2026 CMN Meeting
* Updated until Apr, 12 * Updated until April, 15
Source: BCB
 21
INTEREST RATE
Brazil
Real interest rates
Real interest rate has fallen in Brazil relative to its peers.

Ex-ante real interest rates: Ex-ante real interest rates: Ex-ante real interest rate: difference
14 Brazil and AEs 9 Brazil and EMEs between Brazil and peer average*
(% p.y.) (% p.y.)
4%
12
3.6%
10 6.87
6 6.08
8
4.92 3%
6 6.08 2.6%

4 3
2.41 2.43
2 2.26 2%
0.99
0
0
-2 1.2%
1%
-4
-3
-6

Apr-21
Apr-14
Apr-15
Apr-16
Apr-17
Apr-18
Apr-19
Apr-20

Apr-22
Apr-23
Apr-24
0%
Brazil Mexico Colombia Chile 2014-2019 2021-2023 2024
US UK Euro area Brazil
*Chile, Colombia, Mexico.
Sources: Bloomberg, central banks, BCB.
 22
INTEREST RATE
Brazil
Real interest rate vs. neutral rate
Difference between the real interest rate and the neutral rate is lower in Brazil than in its peers.
Monetary effort: 1-year real interest rate minus real neutral rate
(p.p.)
Brazil and AEs Brazil and EMEs
4
5
3 4.27
4
2 1.58 3
2.72
1.40
1 2 1.68
1.15
1 1.58
0.74
0
0
-1
-1
-2 -2

-3 -3
-4
-4
-5
-5 Apr-21 Nov-21 Jun-22 Jan-23 Aug-23 Mar-24

Brazil Chile Colombia Mexico

Brazil US Euro area UK
Sources: Bloomberg, central banks, BCB.
 23
MONETARY POLICY
Brazil
Monetary policy
261st Copom meeting – March 2024
• Considering the evolution of the disinflationary process, the assessed scenarios, the balance of risks, and the broad array of available information,
Copom decided to reduce the Selic rate by 0.50 percentage point, to 10.75% p.a., and judges that this decision is consistent with the strategy for
inflation convergence to a level around its target throughout the relevant horizon for monetary policy, which includes 2024 and, to a larger degree,
2025.

• Without compromising its fundamental objective of ensuring price stability, this decision also implies smoothing economic fluctuations and fostering
full employment.

• The current context, characterized by a stage in which the disinflationary process tends to be slower, with only partial reanchoring of inflation
expectations and a challenging global outlook, requires serenity and moderation in the conduct of monetary policy.

• The Committee reinforces the need to persist on a contractionary monetary policy until the disinflationary process consolidates and inflation
expectations anchor around its targets.

• If the scenario evolves as expected, the Committee members unanimously anticipate a reduction of the same magnitude in the next meeting, and
judge that this monetary policy stance is appropriate to keep the necessary contractionary monetary policy for the disinflationary process.

• The Committee emphasizes that the total magnitude of the easing cycle throughout time will depend on the inflation dynamics, especially the
components that are more sensitive to monetary policy and economic activity, on inflation expectations, in particular the longer-term ones, on its
inflation projections, on the output gap, and on the balance of risks.
 24
ACTIVITY
Brazil
Economic activity
GDP decelerating, but recent indicators show some improvement, which is reflected in a recent rise in expectations for 2024

GDP Surprise in GDP growth Potential output – QPC

(Expectations vs observed growth) 2.5
110 (Q4 2019=100, seas. adjusted)
6 2.0
2023: 2.9% Survey median - start of the year 2.0 1.9
4.8 1.8
Observed
4 1.5
105 3.4
3.0 2.9
1.0

2
0.5
100 0.8
0.3
0.0
0
Dec/21 Dec/22 Dec/23
2021 2022 2023
95

2024 GDP expectations*

2.2%
1.9% 1.9%
90 1.8% 1.7%

(median)
1.7%

GDP Pre--pandemic high 1.4%

85
Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4 Q4
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 1.0%
Mar-22 Jun-22 Oct-22 Jan-23 May-23 Aug-23 Dec-23 Apr-24
* Updated until Apr, 5 Focus BCB IMF
Sources: IBGE, BCB Focus Report, QPC.
 25
ACTIVITY
Brazil
Economic activity
Recent indicators show slightly higher dynamism than previously expected, particularly in the retail sector
Economic activity Retail sales (PMC)
2018-2019 average =100 2019 average = 100
120 120
115

115 110
Services
105
Retail 100
110
95
IBC-BR
90
105
Feb-19 Feb-20 Feb-21 Feb-22 Feb-23 Feb-24
Restricted PMC Broad PMC Supermarkets Furnishing and appliances

100 110 Confidence indexes (FGV)

Manufacturing Neutral = 100

95 100

90
90

80
85
Aug-19 Feb-20 Aug-20 Feb-21 Aug-21 Feb-22 Aug-22 Feb-23 Aug-23 Feb-24 70
Mar-21 Sep-21 Mar-22 Sep-22 Mar-23 Sep-23 Mar-24
Sources: IBGE. Consumer Manufacturing Building Retail Services
 26
ACTIVITY
Brazil
Labor market
Labor market keeps resilient and real earnings accelerating.

115

Aggregate real earnings

(2019 = 100 Quarrterly, s.a.)
Unemployment rate 110
(Quarterly, %, s.a.) Effective wages
16 66 105
Usual wages
100

64 95
14 90
85
62

Aug-15

Aug-16

Aug-17

Aug-18

Aug-19

Aug-20

Aug-21

Aug-22

Aug-23
Feb-16

Feb-17

Feb-18

Feb-19

Feb-20

Feb-21

Feb-22

Feb-23

Feb-24
12
60
400
58 300

Net formal job openings

10
Unemployment rate 200

(CAGED, Thousand, s.a.)

Avg. unemployment since Mar-12 56 100

8 Participation rate (%, right) 0

54 -100
-200
6 52 -300
Feb-14 Feb-16 Feb-18 Feb-20 Feb-22 Feb-24 Feb-19 Feb-20 Feb-21 Feb-22 Feb-23 Feb-24
Sources: IBGE, MTE.
 27
FISCAL POLICY
Brazil
Fiscal: results and forecasts

Consolidated public sector primary result 20 Evolution of GGGD/GDP

Central govt. net revenue

(% GDP, several years and forecast, Focus* median) 15 (%, several years, Focus* median)
2 1.9 100
1.7 10

(%, real growth)

92.5
1.3 5 Maximum
0 90 86.9 forecast
1 85.7
0.7
0.6 -5 -2.2
0.25 Median
0.0 0.0 -10 80 forecast
0
-15

2011
1997
1999
2001
2003
2005
2007
2009

2013
2015
2017
2019
2021
2023
-0.5 74.0 Optimistic 74.3
-0.5
70 forecast
-0.6

Central govt. net expenditures

-0.7 25
-1 -0.8 31.1
20
Market
15 12.5 60
forecast
-1.6 10
-1.7
(%, real growth)
-2 5
-2.1 0 50
51.5
-5
-2.5
-9,2 Primary result commitment -10
-3 -15 40
2014

2023
2013

2015
2016
2017
2018
2019
2020
2021
2022

2024
2025
2026

-20
-25
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
* Updated until 04/12/2024 * Updated until 04/12/2024

Sources: BCB (Focus Report), National Treasury and 2025 PLDO.

Technology
Agenda
Design of the financial system
of the future
Digital world transformation

• People are looking for a digital representation of value

• Assets are becoming encrypted

• Distributed ledgers allow assets to be verifiable and

transferable, with divisibility

• We are talking about extracting value from an asset in its

digital form

• Art, pictures, properties, ideas and even money

• Are we moving towards a tokenized economy?

If the tokenization thesis holds true then the 21st Century

may see the creation of regulated, global, token-based,
muti-asset networks.*
* The Regulated Internet of Value, Citi’s Digital Policy, Strategy and Advisory, 06/21.
29
Tokenization of the economy

• The main change is the tokenization of assets for trading

• Asset tokenization generates efficiency gains

• Trade, register, contracts, collaterals etc.

• Greater speed and transparency

• Lower cost

• More open processes

• Programmability in the purchase and sale of assets

30 30
An integrated agenda
The four fundamental blocks

Pix
Rail of programmable
payments

Currency
internationalization
Payment
internationalization

Open Finance
Comparability and portability
in real time

Drex Additional blocks for the future

Tokenization of
the economy Artificial Data
intelligence monetization 31
O Pix gains space and increases its popularity
Pix growth promotes financial inclusion and enables small businesses

Pix growth Pix and financial inclusion

▪ 71.5 million new users included with Pix.*
733 million Transactions by value range Pix users vs. Bank clients
active Pix’s keys. 148 million people and (Only natural persons payers – Nov/20 until Dec/22)

14.0 million companies 35%

Millions
use Pix. Pix Launch
31.4%
160
30%

23.9% 140
25%
20.8%
20% 120
17.1%

15% 100

201.6 million 10%

6.9%
80
operations in one
day 5% 60

4.4 billion transactions in 0%

Feb/24, against 2.5 billion in 40
R$ 0 to R$ R$ 20.00 to R$ 40.00 to R$ 100.00 Over R$
Feb/23, increase of 72.8%.
19.99 R$ 39.99 R$ 99.99 to 199.99 200.00 2018 2019 2020 2021 2022
Total of bank clients with active operations 32
32
* Considering users who did not use TED in the 12 months prior to the launch
Sources: BCB, BIS.
Fontes: BCB, BIS. of Pix and became PIX users. Total of Pix users
O Pix new functionalities

Pix Cobrança Pix Saque (withdrawal) Pix Agendado Pix Automatico

Pix Pix Troco (change) (Scheduling)
(Future dated billing) (Recurring payments)

Transaction
• Single: mandatory
Automatic Pix after
• Recurrent:
payer’s previous
optional
authorization
It will become
mandatory

Frequency: Defined Defined

Value: Fixed Fixed or variable
Receiver: Individual or legal entity Legal entity
Payment instructions: Payer Receiver
Channel: Secondary Secondary
Purpose: Transfer Purchase

Schedule
Dec/23 Mar/24 Apr/24 Aug and Sep/24 Oct/24

Message Standard file

Catalog Automatic Pix Homologation
Regulation Full operation
certification in the tests 33
API Pix Open Finance
Currency ▪ Connection of digital currencies.
internationalization o There will be real time transactions with low cost.

• Three challenges for the connection of international

payments systems:

▪ Technology
o Connection between DLT and centralized systems
(solved) c

▪ Settlements
o Liquidity token pool (solved)

▪ Governance
o Taxonomy (minimal rules for cross-border payments)
o We need to advance on the topic

34
34
 Comparability and portability in real time

Standards and infrastructure that support the sharing

of data and financial services by institutions authorized
Open Finance in figures
to operate by the BCB.
▪ 27 API developed and 12 under development.
The Brazilian model is a global reference.
▪ More than 42 million consents to share data.

Greater financial and digital inclusion. ▪ More than 1.4 billion API calls, on average, per week
(phases 2 and 4).

▪ More than 68 billion API calls (phases 2 and 4).

Convergence to marketplaces, with one or few
environments for comparison of products and
▪ More than 800 participating institutions (all phases).
services.

Competition for channel and principality.

35
 Digital Real
Tokenization of the economy
Benefits in three dimensions:

1. Banking efficiency
▪ To introduce the concept of tokenization

➢ Risk management, collateral, financing, asset management,

data analysis, settlement and products

2. Efficiency in digital payments

▪ Bridge to De-Fi environment

➢ To bring decentralized finance into the regulatory perimeter

▪ Efficiency in financial intermediation

3. Efficiency in contracts and register

36 36
 Pilot project
Drex enters a new phase

Objectives Guidelines:
• Development of the Drex platform 1. Multi-asset DLT - Hyperledger Besu

• Dialog with society on Drex development 2. Simulated transactions

3. Asset fragmentation
4. Access to services through IFs and IPs

Next steps:
Government
Drex contracts:
Start of Drex bonds Entry of new Conclusion of privacy
Workshop wholesale and Assessment
pilot contracts participants tests
retail
Mar/23 Apr Sep Oct Nov/23 May/24 Jun

Development and tests Other protocols

37 37
 Financial services aggregator
Hello!
Choose the institution Offline

Bank A Bank B Bank C

Online

Choose the service

Data
Debit Credit Investiments Others
wallet

▪ Marketplace environment
▪ Competition by channel and for principality

Consolidated Payment
position flows 38
Artificial intelligence
Inteligência artificial

▪ The use of AI in the Super App can transform

it in a financial advisor of the future.

▪ With programmability, connection with

marketplaces and a comprehensive dataset,
AI can be used in the 4 blocks for:

▪ Financial consulting
▪ Financial education
▪ Process optimization (software and
hardware) and improvements in the user
experience.

39
39
Data monetization

• Data has become a great asset.

• Users are the owners of their data, but it is

currently very difficult for them to monetize it.

• With marketplaces and connection between

platform and digital wallet, clients will be able
to store their data and monetize it.
• Interaction of tokens with digital wallet

40
Thank you!

Roberto Campos Neto

Governor of Banco Central do Brasil
April, 2024