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Tesouro Selic, CDBs and the CDI: Brazilian Fixed Income Explained
With the Selic in double digits, Brazilian fixed income pays real returns most countries can't match. How Tesouro Selic, CDBs, LCIs and LCAs work — taxes, FGC protection and liquidity.
Mauricio Nunes dos ReisFounder & EditorFew countries reward savers like Brazil. With the Selic in double digits, a plain-vanilla government bond pays what stock investors elsewhere dream about — in nominal terms, at least. Here is how the core products actually work.
The products, compared
| Product | Benchmark | Income tax | Liquidity | Protection |
|---|---|---|---|---|
| Tesouro Selic | ~100% of the Selic | Regressive 22.5%→15% | Daily (D+1) | Sovereign guarantee |
| CDB (daily liquidity) | 100%–120%+ of the CDI | Regressive 22.5%→15% | Daily or at maturity | FGC up to R$250k |
| LCI / LCA | 90%–100% of the CDI | Exempt for individuals | Lock-up, usually 90d–2y | FGC up to R$250k |
| Tesouro IPCA+ | IPCA + fixed real rate | Regressive 22.5%→15% | Daily, but price swings | Sovereign guarantee |
The tax math that decides everything
Because LCIs and LCAs are tax-exempt, a LCA paying 92% of the CDI beats a CDB paying 100% for most holding periods. Quick rule: divide the LCI/LCA rate by (1 − your tax bracket). At the 15% bracket, a 92% LCA is equivalent to a CDB paying roughly 108% of the CDI. Always compare on this grossed-up basis.
Where each product fits
- Emergency fund: Tesouro Selic or a 100%+ CDI CDB with daily liquidity. Nothing else — no lock-ups, no price volatility.
- Money you won’t touch for 1–2 years: LCI/LCA ladders, taking the tax exemption in exchange for the lock-up.
- Long-term inflation protection: Tesouro IPCA+ held to maturity. Mark-to-market swings make it a poor short-term parking spot.
Who this is NOT for
- Anyone paying down expensive debt. The rotativo on a credit card runs above 400% a year; even consignado loans cost far more than any fixed income pays. Kill the debt first.
- Anyone who needs the money within 30 days. IOF wipes out yields on redemptions inside a month; use a conta remunerada instead.
Bottom line
Park short-term money in Tesouro Selic or a daily-liquidity CDB at 100%+ of the CDI, use tax-free LCIs/LCAs for money you can lock up, and reserve Tesouro IPCA+ for genuine long horizons. With the Selic where it is, Brazilian savers are paid handsomely for doing the boring thing.
Frequently asked questions
What is the difference between the Selic and the CDI?
The Selic is the policy rate set by the Banco Central's Copom; the CDI is the rate banks charge each other on overnight deposits and tracks the Selic within about a tenth of a point. Consumer products are usually quoted against the CDI: a CDB paying '110% of the CDI' yields roughly 1.10 times the Selic, before tax.
How is fixed income taxed in Brazil?
Most products (Tesouro Direto, CDBs) pay income tax on a regressive table: 22.5% up to 180 days, 20% up to 360, 17.5% up to 720, and 15% beyond two years, plus a small IOF charge if you redeem within 30 days. LCIs and LCAs are exempt from income tax for individuals, which is why they can pay a lower headline rate and still win.
Is my money safe in a CDB from a small bank?
Up to a point. The FGC (Fundo Garantidor de Créditos) insures up to R$250,000 per CPF per institution, capped at R$1 million across all institutions in any four-year window. Staying inside those limits at FGC-member banks is the standard way to chase higher CDI percentages from smaller issuers.
Primary sources
Rates, rules and figures in this article are drawn from the primary sources below. We refresh money pages quarterly — always confirm current terms with the issuer or regulator before acting.
This article is for informational purposes only and does not constitute financial advice. Always do your own research.