FX.co ★ Ibovespa Falls Ahead of Central Bank Decision

The Ibovespa fell more than 0.5% on Wednesday, slipping below 187,500 amid persistent concerns that elevated energy costs will weigh on domestic demand and prompt the central bank to keep monetary policy tight. Energy prices extended gains as there were still no signs that oil flows through the Strait of Hormuz would return to normal in the near term.

Inflation worries were reinforced by a sharp rise in the IGP-M, which posted its biggest monthly increase in five years in April. Against this backdrop, the central bank is widely expected to cut the Selic rate by 25 basis points after the market close. However, the recent upside surprises in inflation have sustained some bets on an unchanged rate and raised the odds of more hawkish forward guidance.

Most financial stocks traded lower, with Bradesco down about 1% and Banco Santander slipping after missing its Q1 2026 earnings estimates. In the commodities and industrial segments, Vale dropped more than 1% following results that came in below market expectations, while WEG retreated nearly 2% amid a decline in profits.