Brazilian real yields climb as IPCA+ 2032 reaches 7.69%

Inflation-linked Brazilian government bond yields reversed Friday's decline on Monday, September 28, 2026. The Tesouro IPCA+ 2032 rose back to IPCA plus 7.69% per year, offering the highest real yield among available maturities. Across other maturities, the IPCA+ 2040 yield climbed from IPCA plus 7.27% to 7.32%, while the IPCA+ 2050 increased from 7.14% to 7.18%. The IPCA+ with semiannual coupons maturing in 2037 advanced from 7.50% to 7.55%.

The upward pressure followed the central bank's weekly Focus survey, which showed the median 2026 IPCA inflation forecast rising from 4.92% to 4.99%, surpassing the 4.5% target ceiling. Global factors also weighed on local rates, including crude oil moving toward 110 dollars per barrel and United States Treasury yields continuing to hold at their highest levels in two decades. In the Focus survey, median Selic expectations remained at 13.50% for year-end and 12% for 2027, while the exchange rate projection held at 5.20 Brazilian reais per dollar.

Fixed-rate instruments showed smaller increases. The Tesouro Prefixado 2032 moved from 14.13% to 14.15% per year, the Prefixado 2029 reached 13.93%, and the Prefixado with semiannual interest 2037 traded at 14.12%. Breakeven inflation implied in 2032 bonds returned to 6% per year. In floating-rate notes, the Tesouro Selic 2031 offered Selic plus 0.0761%, while the Tesouro Reserva 2036 tracked the benchmark Selic rate, which stood at 13.75% per year.

Rising yields triggered mark-to-market declines for existing bondholders. An investment of 10,000 Brazilian reais made on Friday in the IPCA+ 2050 was worth 9,923.79 reais on Monday, a loss of 76.21 reais. The same investment in the IPCA+ 2040 fell to 9,947.92 reais, down 52.08 reais. A position of 10,000 reais bought on September 16, 2026, ahead of the Copom interest rate cut, was valued at 10,026.44 reais. These paper losses only materialize if sold before maturity.