Brazil: market increases optimism and forecasts a 1.68% rise in GDP in 2023

The financial market economists signaled optimism with the growth of the Brazilian GDP (Gross Domestic Product) in 2023.

They revised the expectation from 1.26% to 1.68% compared to last week.

The estimate is included in the Focus Bulletin of this Monday (5), released weekly by the BC (Central Bank).

Market experts also lowered their estimate for inflation this year from 5.71% to 5.69%. Here is the full report (774 KB).

For 2024 and 2025, analysts project the sum of all goods and services produced in the country at 1.28% and 1.70%, respectively.

The projection for next year’s inflation dropped slightly, from 4.13% to 4.12%.

The projections for 2025 and 2026 continued at the same level of 4.0%.

The estimates for 2023 of the basic interest rate remained the same, with the Selic at 12.50% per year.

Today, the basic interest rate is at 13.75%. For 2024, the level was kept at 10%.

The expectation for the exchange rate for the end of 2023 fell from R$5.11 to R$5.10.

For next year, economists also reduced the projections from R$5.17 to R$5.16.

The Focus report is published every Monday and summarizes the statistical estimates of analysts consulted by the Central Bank since 2000.

In 2020, the CMN (National Monetary Council) set the inflation target for 2023 at 3.25%, maintaining a margin of 1.5 percentage points of tolerance up or down.

The level is considered low by President Luiz Inácio Lula da Silva (PT).

Brazil’s inflation has been above the target limit for two years, in 2021 and 2022.

The president of the Central Bank, Roberto Campos Neto, had to explain publicly for failing to meet the inflation target.

The monetary authority said the probability of missing the inflation target in 2023 is 83%.

With information from Poder360

News Brazil, English news Brazil, Brazilian economy