Keite Camacho
Reporter - Agência Brasil

Brasília - Market analysts expect that inflation, as measured by the Broad Consumer Price Index (IPCA), will be slightly higher than they predicted a week ago. Their forecast was raised from 5.21% to 5.22%. Their forecast for 2006, on the other hand, was lowered from 4.63% to 4.6%.

The Central Bank's weekly survey indicate that the analysts estimate the dollar will be worth about R$ 2.28 by the end of this month and R$ 2.35 at year-end.

With regard to interest rates, they expect the Selic (the government's annualized benchmark interest rate) to close the month at 19% and the year at 18%, the same as they predicted last week. For 2006, they expect the Selic to fall to 16%.

Their estimate for this year's growth in the Gross Domestic Product (GDP) - the sum of all wealth produced in the country - rose in comparison to last week's estimate, from 3.29% to 3.3%. For next year the market analysts project a 3.5% increase.

Their expectations for the trade surplus (exports minus imports) are higher than they were last week, when they predicted a surplus of US$ 41 billion. This week's forecast is for a surplus of US$ 41.54 billion. Their forecast for next year remains unchanged at US$ 35 billion.

Translation: David Silberstein