Economic fundamentals remain relatively solid, but the environment has become more challenging because of global interest-rate repricing, uncertainty surrounding central-bank credibility, and Brazil’s fiscal and electoral risks.

The recent decline in oil prices and a broad range of industrial input costs may contribute to a gradual disinflationary process over the coming months, particularly in advanced economies.

We present a post-war scenario with a focus on the impact of oil on inflation, interest rates, and global growth. Even with a possible ceasefire, inflationary effects are likely to remain persistent, limiting the scope for rate cuts in the US and the UK.

The outlook combines strong structural drivers (AI-led productivity and growth) with negative short-term shocks, especially higher oil prices. Globally, inflation remains persistent, limiting the scope for interest rate cuts, particularly in the U.S. Brazil, despite its strengths in commodities and energy, is constrained by inflation and high interest rates. The political environment is polarized and pessimistic, with rising risks of radicalization. An unsustainable growth model—based on fiscal expansion and credit—has increased debt, delinquency, and investor caution.