Citi's latest report on Latin American economies underscores significant inflationary pressures in Brazil, with the Central Bank of Brazil (BCB) facing mounting challenges. The BCB's Focus survey reveals a notable rise in inflation expectations, with year-end forecasts for 2024 climbing to 4.84% from 4.71% last week, and 2025 projections increasing to 4.59% from 4.40%. These figures exceed the upper target bound of 4.5%, intensifying pressure on the BCB's monetary policy decisions. Citi anticipates a potential 75 basis point hike in the Selic rate on December 11, 2024, with a 100 basis point increase also on the table. Meanwhile, the report highlights a broader emerging market strategy, noting the potential for the Brazilian real to stabilize against the euro and U.S. dollar as 2025 approaches, despite risks of a dovish BCB tilt.