Potential Fed policy shift under Warsh nomination threatens Brazilian monetary easing cycle

The potential appointment of Kevin Warsh as Federal Reserve Chair suggests a shift toward a more hawkish monetary stance, which analysts at FGV Ibre warn could constrain the Central Bank of Brazil's ability to continue cutting the Selic rate. The primary uncertainty remains the extent to which Warsh would prioritize inflation control over growth, potentially increasing global market volatility and limiting emerging market policy flexibility.