Brasília – The Brazilian Central Bank has revised its economy shrinkage forecast for this year. The Gross Domestic Product (GDP), i.e. the sum of all goods and services produced in the country, is now expected to contract 3.6%, up from 2.7% in the September forecast. The number is from the Inflation Report released this Wednesday (23). In 2016, GDP is expected to shrink 1.9%.
Agricultural output should be up 0.5% next year, with industry production dropping 3.9% in the third straight year-on-year decline. The services sector is expected to contract by 1.2% in 2016, in line with industry output and consumption per household.
Households consumption should drop 2% in 2016, an improvement over this year’s 3.8% forecast. Gross Fixed Capital Formation should be down 9.5% in 2016 and 14.5% this year.
The Central Bank also predicts that “the weakened Brazilian economy will continue to impact upon goods and services imports, which are poised to drop 11% in 2016, contrasting with the 2% export growth forecast.”
*Translated by Gabriel Pomerancblum
