April Economic Activity in Brazil Down Record 9.73 Percent from March

RIO DE JANEIRO, BRAZIL – Amid the impact of the Covid-19 pandemic, economic activity fell sharply in April. The Central Bank’s Economic Activity Index (IBC-Br), seasonally adjusted for the period, shrank by 9.73 percent in April compared to March this year, according to data released yesterday, June 18th, in Brasília by the Central Bank (BC). This was the highest monthly contraction since official records began in January 2003.

It was the second consecutive month of decline, according to data revised by the Central Bank. In January, there was a 0.06 percent increase, a 0.31 percent rise in February and a 6.16 percent drop in March, compared to the previous month.

In the fourth month of the year, when compared to April 2019, the downturn reached 15.09 percent (no adjustment for the period, since the comparison is between identical months).

In the 12-month period ended in April, the indicator showed a 0.52 percent decline. In the year, the IBC-Br reported a 4.15 percent contraction.

The IBC-Br is a means of assessing the development of Brazilian business activity on a monthly basis and helps the Central Bank make its decisions on SELIC, the basic interest rate. The index includes activity level data for the three sectors of the economy: industry, trade and services, and agriculture and livestock, in addition to the tax volume.

However, the official indicator to gauge economic performance is the Gross Domestic Product (GDP), computed by the Brazilian Institute of Geography and Statistics (IBGE), released quarterly.

Source: Agência Brasil