Better outlook for Brazil’s economy

Market analysts, consulted weekly by the Central Bank of Brazil to prepare the Focus report with its economic projections, corrected their inflation estimates downwards for the sixth consecutive time.

According to their forecasts, the Consumer Price Index (CPI) will rise 7.11% this year, while it was 7.67% four weeks ago.

The National Wide Consumer Price Index (IPCA), Brazil’s main inflation index, ended the month of July with a decline of 0.68%. The IBGE released the result on Tuesday, July 9.

Regarding the exchange rate, the market expects the dollar to be quoted at R$5.20 by the end of the year, slightly above its current parity of around R$5.14.

Analysts do not foresee any changes in the Selic rate, which will remain at 13.75% until the end of 2022, even though the Central Bank left the door open to further increases at its last meeting.

As for the activity level, GDP is expected to grow 1.8%, showing a moderate upward trend in recent weeks. On the other hand, the trade surplus is expected to reach US$68 billion this year.

The fiscal figures show a surplus of 0.30% of GDP in the case of the primary result and a deficit of 6.80% in the case of the primary result.

The economic picture continues to improve in Brazil, which is good news for Argentina because it is the main destination of its exports.

With information from El Economista