Roberto Campos Neto brings perspectives for the macroeconomic scenario of 2026.

Thank you very much, Raquel. Happy 2026 to you and to everyone watching us.

Look, excellent question. Thank you for the question and for the interview once again. I think that since the last time we talked about this topic, I see that there is a larger volume of people, academics, columnists talking about the subject, right? I think, mainly in the United States, the subject has gained considerably more traction, but I also just returned from a recent trip I took to Europe and also felt that in Europe this topic, mainly in France, gained more traction, greater traction. And I think there are several causes, right? First, when we think that we, globally speaking, as a global society, spent 20% of GDP during the pandemic, and we reached 105, 106% of GDP, right? And it was imagined that we would quickly return to 85% of GDP; we are at 100, almost 101%. And then, as you mentioned, heading back to the highs. In the end, I think there is a part that is explained by the difficulty of cutting the additional spending that was made, and another difficulty that is explained by the new spending being made that was not anticipated or that was anticipated, but in a more timid way.

So, let's start with the first one. We have a very great difficulty in removing the assistance programs that were created during the pandemic. We had several types of programs during the pandemic, globally speaking: there was a portion that was simply income transfer to people; there were some very large programs for job guarantees; there were many programs that transferred money to small and medium-sized enterprises to guarantee employment; there were also many programs to ensure access to cheap credit. When we take this whole group of programs that were carried out, we rolled back roughly 20 to 25% of them. So the rest turned into kind of structural spending. So I think we failed both in the design of the measures and in designing a measure that would already have an end date. I'm not just talking about Brazil—globally it's like this. It is also true that the pandemic generated more inequality, and a large part of the measures were also measures that addressed that inequality. And it is very difficult to roll back the measures because it is always a very tough political factor to confront—ending a measure that was created during the pandemic while the inequality accelerated during the pandemic hasn't receded yet. I think that's one point. So the first point is that we haven't managed to stop spending.

The second point is that we have new spending. The world had already been undergoing a process, but this process intensified: we have an aging population. So you have social spending that is increasing because of that. Brazil is a clear example, but several other countries have the same problem. We have an aging world. The only place in the world where we still have a younger population is precisely the poorest place, which is a large part of Africa, the poorest countries that we call LICs—low-income countries—that is, the countries that have the lowest income. So, there was population aging. There is the issue of energy transition, which ended up being much more expensive, much more complex to carry out. Today we see that some countries are backtracking on transition goals because it has been expensive. We also had much more complex geopolitics, which caused defense spending to increase significantly. We see several countries in the world today allocating larger defense budgets. So you have more defense spending, and as we rebuilt global supply chains, global trade chains, there is a very large cost in readjusting production—both in the private and public sectors—productivity, and efficiency to this new reality.

So, indeed, on one side you had difficulty stopping spending, and then there was new spending. What that means in the end is low productivity. So, looking at low productivity ahead, it's very difficult to imagine that we will get out of this conundrum if we don't have a way to generate a positive shock that improves productivity and reduces spending. When we look at the world today, the primary deficit, especially in the emerging world, is around 3.7%, 3.8%. So, not only are we not paying back what we borrowed, but on the margin we are borrowing more. So it's very difficult to imagine that this will have a balance, a return to balance, or a very fast convergence. And I think it's important that this happens, because I think today governments are in a comfortable situation of understanding that what was done was important and needs to continue, but at some point we are going to start having a liquidity drain due to a rise in risk premiums. And then I think emerging countries will suffer sooner and will have to address this debt problem faster.

Exactly. Exactly.

Look, I think first that the issue of tariffs was an issue where the element of uncertainty ended up prevailing the most—not the tariff itself, but not being able to plan your production process because the tariff changed very quickly. A large part of the tariffs that were higher rolled back in some magnitude.

But it's true: I think the initial estimates that tariffs would generate higher inflation in the United States did not prove true. There are some prices that were more influenced by tariffs. Indeed, coffee went up a lot, partly even because of what was done regarding Brazil. So yes, there are some items that rose. American inflation, in terms of how people feel inflation, is measured less by the Central Bank index and more by something we call salient prices. People don't know daily inflation; they have certain prices that in their minds signify more inflation. In the United States, it's closely tied to some food items like meat, and gas at the pump. So when we look at surveys today, what we look at in terms of sensitivity for American society is what we call affordability, that is, the American's ability to buy things. That is weakened. When we look at affordability, it is still at levels that generate dissatisfaction. So today there is still a large volume of dissatisfaction. I think that partly explains the reversal of some tariffs as well, but it's true that when we take inflation as a whole, it didn't have the expected effect. We also don't think the United States has room to cut interest rates very much; it will cut rates a little, but I think there is an issue with the long end of the yield curve that shows some signs of a lack of credibility.

The fact that the dollar has weakened a lot is also something that adds to this equation of uncertainty about what the dollar's trajectory will be and what its effect on inflation will be. There was a super interesting article the other day, and I spoke with someone who works at the company, which was Walmart, that people are buying gold in the United States. So, one of the things—

And at Walmart it sells out, by midday it's gone, there's no more, right? The shipment arrives in the morning, people go and buy small pieces of gold to keep at home. When we think about that, this entire cryptocurrency movement, people losing some credibility, let's say, in the traditional standard of the dollar—I think that shows a bit of disbelief. Obviously, it's a very incipient movement and very long-term, but it shows some of this concern over how governments in general are treating their currencies poorly. So I think there is a theme where we will still have quite a bit of uncertainty. And then there are several other issues in the United States regarding the sustainability of this growth model that I think will be tested.

Yes, I would say that 2026 will be a year with greater volatility in Brazil, clearly due to the elections, but I think there is a greater possibility of having an asset repricing in the world.

China had less of this expectation than the market did, because China built a large diversification network in terms of exports, and there is a lot of triangulation. There are a lot of Chinese products that arrive in the United States after passing through Mexico. There are many products that arrive in places with restrictions, but they underwent very small processes in other countries. China built this very well; they have a large investment in a fairly substantial consumer market. China's problem, in my opinion, was more of a medium-term problem, which I would say consists of three major things.

First, population aging in China took a jump—when we look at those aging charts, it made a little jump that is very surprising, because population aging is usually something very easy to predict. When we take the difference from one census to another in China, it jumped upward. They created several programs to stimulate fertility again and encourage people to have more children; it's not working. It's something very deeply ingrained in Chinese culture today to have fewer children. That might change, but it's hard to change in the short term. Another problem is that China is a very centralized economy with very centralized management. A very large volume of resources was allocated to this industry linked to electrification, batteries, electric cars, and so on. So there has always been a question of whether there is overcapacity—was it exaggerated? Will there be a consumer market for all these electric cars? Does this investment yield a return? Up until now, it has shown that in some countries it is starting to have some effect, but for the most part they managed to diversify: they make electric buses, and there is the battery issue, where China holds great dominance today. And then there is a third issue, which is real estate, because this is an issue that has been around for a long time in China, going back and forth. Up until two months ago, we had bad news again, closely linked to some specific provinces. It was imagined that they would be able to clean up this problem more quickly; that was not the case. So there is a perception that China will decelerate a bit too. For next year, people are expecting between 4, 4.2, 4.3%, with the most optimistic at 4.5%. But still, that is high growth. China hasn't had any disruption, any non-continuous, non-linear movement, but I think it deserves attention. And there is the issue of Taiwan and semiconductors, which is super relevant to understanding how this dominance will play out. Today you have a new Cold War, which is an artificial intelligence Cold War, a cold war of reaching the maximum potential of artificial intelligence.