According to the Brazilian Central Bank’s economic activity index (IBC-Br) — which serves as a predictor of official GDP figures — the country’s economy is set to contract 0.15 percent in August. The index has seen modest rises and falls over the past five months, but August results put an end to two consecutive months of 0.23-percent growth in the IBC-Br.
Compared to August of last year, the IBC-Br enjoyed growth of 4.74 percent.
With the end of most social distancing restrictions, Brazil had expected H2 2021 would be one of sturdy growth. However, these hopes have been dashed by spiraling inflation, political uncertainties, and the ongoing energy crisis.
While the IBC-Br was created to try and forecast official GDP results revealed later in the month, it is not always accurate due to different calculation methodologies.