Brazil’s economy minister sees GDP growth in 2022 at over 2.5%, and the central bank is already talking about 3%

Economy Minister Paulo Guedes said that the Brazilian economy has already grown by 2.5% in the first half of this year and is expected to grow even faster by the end of the year.

The government’s official forecast is 2.5% and should be revised.

The statements were made during a United Brazil Institute event Thursday afternoon (Sep. 1) in São Paulo.

The minister also said he had a brief conversation with Central Bank President Roberto Campos Neto, who, according to Guedes, is already talking about a GDP of 3% this year.

The Brazilian Institute of Geography and Statistics (IBGE) reported that the economy grew by 1.2% in the second quarter of this year, above the expectations of financial market analysts.

The data prompted several institutions to revise their forecasts.

North American Bank of America raised its forecast for Brazilian GDP growth this year to 3.25% from 2.5%.

Economic growth in the second quarter was the seventh highest among 26 countries. Brazil ranked behind Holland (+2.6%), Turkey (+2.1%), Saudi Arabia (+1.8%), Israel (+1.6%), Colombia (+1.5%) and Sweden (+1.4%).

“Brazil may have lower inflation and higher growth than the G7,” Guedes said.

The G7 is composed of the world’s largest economies.

Guedes said that market economists are wrong in their forecasts because they are looking at the old economic growth model.

The minister also said that Brazil’s monthly survival aid of R$600 will be disbursed in 2023 and that public accounts have been at their best since 2013.

“There is no fiscal bomb in 2023,” he explained.

The economist said that if the country’s development bank BNDES returns R$90 (US$18) billion to the Treasury, the debt-to-GDP ratio will fall to 76.6%.