What is a Taxa Selic?
A Selic is the basic interest rate in Brazil. It is defined by the Copom (Monetary Policy Committee of the Central Bank) every 45 days. It is the “mother” of all interest rates — when the Selic rises, everything becomes more expensive (loans, financing). When it falls, it becomes cheaper.
What is it for
The Central Bank uses the Selic to control inflation:
- High inflation? → Raise the Selic → Credit becomes expensive → People spend less → Prices stop rising
- Weak economy? → Lower the Selic → Credit becomes cheap → People spend more → Economy heats up
Impact on your investments
| Selic high | Selic low |
|---|---|
| Fixed income yields more | Fixed income yields less |
| Savings improve | Savings worsen |
| Stocks tend to fall | Stocks tend to rise |
| Expensive financing | Cheap financing |
Selic and CDI
The CDI closely follows the Selic (usually 0.10% below). When you see “CDB that yields 100% of the CDI”, it’s yielding practically the Selic.
Current Selic
The Selic is updated at each Copom meeting. Check the Central Bank’s website for the current value.