Brazil Economic Activity


Brazil: Economic activity rebounds to six-year high in July

September 12, 2014

In July, economic activity rose 1.5% 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 rebound from the 1.5% contraction tallied in June and represented the largest increase since June 2008. The result came in well above market expectations of economic activity increasing 0.8%.

On an annual basis, economic activity contracted 0.2% in July, which was softer than the 2.1% drop tallied in June. Meanwhile, annual average growth fell from 1.5% in June to 1.2% in July, which is the lowest level since March 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 0.5% in 2014, which is down 0.5 percentage points from last month’s estimate. For 2015, the panel sees GDP growth at 1.3%.

Author: Angela Bouzanis, Senior Economist

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