Brazil Economic Activity


Brazil: Economic activity contracts in May

July 17, 2014

In May, economic activity fell 0.2% over the previous month in seasonally-adjusted terms according to the Central Bank’s monthly indicator for economic activity (IBC-Br, Indice de Atividade Economica do Banco Central). The figure marked a deterioration over the revised flat reading tallied in April (previously reported: +0.1% month-on-month). The result came in slightly above market expectations of activity dropping a stronger 0.4%.

On an annual basis, economic activity contracted 0.2% in May, which was up from the 2.3% drop tallied in April. Meanwhile, annual average growth fell from 2.2% in April to 1.9% in May, which is the lowest level since April 2013.

The Central Bank’s Inflation Report from June indicates that it expects GDP to grow 1.6% in 2014 and to accelerate to a 1.8% expansion in 2015. LatinFocus Consensus Forecast panelists expect the economy to expand 1.2% in 2014, which is down 0.3 percentage points from last month’s estimate. For 2015, the panel sees GDP growth at 1.6%.


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Brazil Economic Activity Chart

Brazil Economic Activity May 2014

Note: Month-on-month changes of seasonally adjusted IBC-Br (Indice de Atividade Economica do Banco Central) and annual average growth rate in %.
Source: Central Bank of Brazil.

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