Brazil: Consumer confidence drops to lowest level since May 2009
February 24, 2014
In February, the consumer confidence index published by the Getulio Vargas Foundation (FGV, Fundacao Getulio Vargas) fell a seasonally-adjusted 1.7% over the previous month, which followed the 2.1% decrease registered in January. The index decreased to 107.1 points, which marked the lowest level since May 2009. February's result reflects that households' assessments of the current economic situation are more negative and that they have lower expectations for the future of the economy.
The FGV confidence index spans a range of 1 to 200 points, where 100 points is considered neutral. While consumer confidence remains above the 100-point threshold, a downward trend has been recorded in recent months, which does not bode well for growth in private consumption going forward.
LatinFocus Consensus Forecast participants expect private consumption to expand 2.3% in 2014, which is unchanged from last month's forecast. For 2015, panelists expect private consumption to increase 2.5%.
Author: Carl Kelly, Economist