Brazilian GDP projections slashed for 17th week in a row

Financial institutions heard by the Central Bank as part of its weekly Focus Report expect the Brazilian GDP to plunge 6.48 percent in 2020. The perspectives for 2021 are of a mild recovery of 3.5 percent. The drop was led by industry perspectives, as the sector is expected to fall 5.35 percent, versus predictions of 3.59 percent a week before.

Meanwhile, the IPCA index — the benchmark for consumer inflation in Brazil — is expected to end 2020 at 1.53 percent, rising to 3.1 percent in 2021, according to the survey. However, both estimates are significantly below the targets of 4 percent and 3.25 percent for 2020 and 2021, respectively. With inflation well tamed, economists expect Brazil’s benchmark interest rate to see out the year at just 2.25 percent, before rising to 3.5 percent in 2021. 

• #centralBank
• #recession