New York, January 29, 2026, 11:25 EST — Regular session
- Shares of Nu Holdings dropped roughly 2.6% during mid-session trading
- Brazil’s central bank kept rates steady at 15%, signaling potential cuts beginning in March
- Investors are weighing a credit environment that remains tight against emerging signs of easing
Shares of Nu Holdings slipped 2.6% to $18.27 on Thursday, cutting into the week’s earlier gains as investors digested mixed signals on interest rates in Brazil, Nubank’s largest market.
Rate expectations are shifting once more in Brazil, making this move significant. Funding costs and credit demand can rapidly alter the calculations for lenders. While a lower policy rate may boost loan growth, it also squeezes interest margins—the gap between what banks earn on loans and what they pay for funding.
Brazil’s central bank kept its benchmark Selic rate steady at 15% on Wednesday, signaling a likely rate cut starting at its March meeting but emphasizing caution. Flavio Serrano, chief economist at Banco BMG, described policymakers as “as clear as possible” about kicking off an easing cycle. (Reuters)
New figures reveal why the debate remains unsettled. Bank lending in Brazil climbed 10.2% in 2025, surpassing the central bank’s own predictions. Household lending jumped 11.6%, but default rates on a broad measure excluding earmarked credit crept higher to 5.4%, according to official data. (Reuters)
Nu, the company behind digital lender Nubank, has been particularly reactive to Brazil’s interest-rate shifts due to its rapid expansion in unsecured credit. When traders anticipate rate cuts, the stock tends to reflect expectations around how that could impact borrowing demand and credit losses in the coming quarters.
The company made no immediate announcement on Thursday.
During U.S. trading, Nu fluctuated from $18.24 up to $19.03, following a previous close of $18.76, according to market data.
The downside is clear-cut. Defaults could rise alongside growing household debt, or policymakers might lag behind investor expectations. In either scenario, lenders face a double hit: deteriorating credit quality and fewer benefits from cheaper funding.
Nu has highlighted scale gains and growth in Mexico as key drivers behind its recent profit surge. Investors are zeroing in on the company’s ability to boost credit while keeping delinquencies in check. (Reuters)
Traders are now turning their attention to March’s Copom meeting to gauge the scale of Brazil’s initial rate cut. Meanwhile, Nu’s next quarterly earnings are due late February, with market calendars pointing to Feb. 19. (Nasdaq)
