Brazil Economic Outlook
November 10, 2020After GDP plunged at a record pace in Q2, the economy likely rebounded in Q3. Activity in the goods sector seemingly bounced back, with industrial production growing strongly in the quarter and retail sales climbing in July–August, bolstered by the emergency pandemic payments. Moreover, the manufacturing PMI remained firmly in expansionary territory in Q3, while confidence in the industrial sector rebounded in September. Turning to Q4, incoming data paints a mixed picture. Both the manufacturing PMI and business confidence hit new record highs in October, boding well for investment. However, consumer sentiment turned more pessimistic in the same month, hinting that the recovery could be losing momentum. In other news, on 3 November, the Senate passed the central bank autonomy bill, which would limit political interference in monetary policy. The bill still requires approval from the lower house of Congress, however.
Brazil Economic GrowthAfter this year’s projected contraction due to the Covid-19 hit, the economy is seen rebounding strongly in 2021 as domestic and foreign demand recover. However, the gradual reducing of fiscal stimulus as the coronavirus shock fades, an elevated unemployment rate and ballooning public debt represent downside risks to the outlook. FocusEconomics analysts see the economy rebounding and growing 3.4% in 2021, which is down 0.1 percentage points from last month’s forecast. In 2022, panelists see GDP growth at 2.5%.
Brazil Economy Data
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|Bond Yield||6.79||-0.82 %||Dec 31|
|Exchange Rate||4.02||-0.13 %||Jan 01|
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Brazil Economic News
July 8, 2021
Consumer prices increased a seasonally-adjusted 0.53% over the previous month in June, slowing down from the 0.83% rise recorded in May.
July 2, 2021
Industrial output grew 1.4% in month-on-month seasonally-adjusted terms in May, which contrasted April's 1.5% decrease and marked the first expansion in four months.
July 1, 2021
The IHS Markit Manufacturing Purchasing Managers’ Index (PMI) climbed to 56.4 in June from May's 53.7, marking the best reading in four months.
June 28, 2021
The Getulio Vargas Foundation’s (Fundação Getúlio Vargas) industrial business confidence index rose to 107.6 in June from May's 104.2.
June 25, 2021
Brazil’s current account posted a surplus of USD 3.8 billion in May, contrasting the USD 0.5 billion deficit recorded in May last year, while narrowing somewhat from the USD 5.7 billion surplus logged in April.