The 13.75% rate began under Bolsonaro. Today, the Selic is falling.

Since 2021, the president of Banco Central has a fixed term, and the president of the Republic can only dismiss them in the cases listed by law^[2]. Bolsonaro signed it into law: “Giving up power is a sign, in my view, of greatness and democracy”^[4]. Flávio voted yes^[3].

In June 2023, with the Selic at 13.75%, Lula said: “There is no explanation for an interest rate of 13.75%”^[5]. The rate stayed. In July 2024, 66% thought he was right to criticize the BC^[6].

In June 2025, the Copom chaired by Gabriel Galípolo, appointed by Lula, raised the Selic to 15%^[1]. That is what autonomy provides: the BC decides, not the Planalto. Since March 2026, five cuts have brought it down to 13.75%^[1].

In the 12 months to August 2026, the public sector paid R$ 1.182 trillion in interest, or 8.86% of GDP. That is more than 14 times the period’s primary deficit of R$ 82.1 billion^[7].

The recipients are the holders of government securities: financial institutions (31%), pension funds (23%) and investment funds (22.5%). Tesouro Direto savers hold 3%, and financial institutions hold more than ten times that^[8].

More than half of federal debt, 52.74% in August 2026, pays a rate that tracks the Selic^[8]. Those with money in these securities receive the Selic rate. This is rentier income: earning from invested money without producing.

In January 2026, Brazil’s real interest rate of 9.23% was the second highest among 40 economies, behind only Russia^[9]. In 2025, a year of high Selic rates^[1], Itaú made R$ 46.8 billion in profit, the highest ever for a Brazilian bank in inflation-adjusted terms^[10].

Paulo Guedes, Bolsonaro’s economy minister, retained while in office a US$ 9.55 million offshore company in the British Virgin Islands, a tax haven^[11]. In 2021, he advocated removing taxation in tax havens from the income tax (IR) reform: “Either remove it or simplify it. Remove it.”^[12] He says he declared everything to the Receita^[11]. The PGR closed the request for an investigation^[13].

Roberto Campos Neto, appointed by Bolsonaro to Banco Central, had an offshore company exposed by the Pandora Papers and closed one of the companies 15 months after taking office^[14]. He says the PGR had already closed the case, and in 2024 Toffoli ended the Ethics Commission proceedings^[14]. After the cooling-off period, he joined Nubank^[15].

Three things to remember: the 13.75% rate began in August 2022, the Copom decides, and the rate is now falling^[1]. The autonomy that took the Selic out of the president’s hands had Flávio’s vote^[3].