Company: PAX
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001628280-25-025640
Chunk: 83

Company: Patria Investments Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 83
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 Uncertainty remains as to the continued inflationary pressures resulting from the indirect impacts of conflicts, such as the ongoing wars in Israel and Ukraine, on global supply chains.

According to the National Consumer Price Index (Índice Nacional de Preços ao Consumidor Amplo) (“ IPCA”) which is published by the Brazilian Institute for Geography and Statistics (Instituto Brasileiro de Geografia e Estatística) (the “ IBGE”), Brazilian inflation rates were 4.8%, 4.6% and 5.8% for the years ended as of December 31, 2024, 2023 and 2022, respectively. Brazil may experience high levels of inflation in the future and inflationary pressures may lead to the Brazilian government’s intervening in the economy and introducing policies that could harm our business and the trading price of our Class A common shares. One of the tools used by the Brazilian government to control inflation levels is its monetary policy, specifically relating to interest rates. An increase in the interest rate restricts the availability of credit and reduces economic growth, and vice versa. During recent years there has been significant volatility in the official Brazilian interest rate, which ranged from 14.25% on December 31, 2015 to 2.00% on August 5, 2020. This rate is set by the Monetary Policy Committee of the Central Bank (Comitê de Política Monetária) (“ COPOM”). On March 17, 2021, COPOM began to rapidly raise the SELIC rate, first to 2.75% and then by the end of the year to 9.25% on December 8, 2021. In 2022, COPOM continued to raise the rate, reaching a peak of 13.75% on August 3, 2022, where it remained stable. On August 2, 2023, COPOM reversed this trend by lowering the SELIC rate to 13.25%, and continued a pattern of reductions ultimately reducing it to 10.50% on May 8, 2024. However, on September 18, 2024, in response to inflationary pressures, COPOM began to increase rates again, increasing the SELIC rate first back to 10.75%. As of the date of this annual report, the SELIC rate is now 14.75%. Conversely, more lenient government and Central Bank policies and interest rate decreases have triggered and may continue to