Brasília – The Brazilian Central Bank has maintained its credit growth forecast for this year at 12%. In August, credit operations amounted to R$ 2.864 trillion (US$ 1.193 trillion), up 11.1% over the 12-month period ended August. Credit is expected to be equivalent to 58% of Brazil’s Gross Domestic Product (GDP), i.e. the sum of all goods and services produced in the country, same as in the prior estimate.
Free credit, whereby banks are free to invest on the market and set interest rates, should be up 6%, less than July’s 7% estimate. The projection for directed credit (loans with rules set by government, primarily targeting housing, farmers and infrastructure) was maintained at 19%.
According to the head of the Central Bank’s Economic Department, Tulio Maciel, the bank’s measures designed to provide more funds for banks to loan have prevented a downward revision of credit growth forecasts for this year. In August, the Central Bank supplied R$ 25 billion (US$ 10.4 billion) for banks to loan. By the end of July, the monetary authority had already announced measures designed to inject R$ 45 billion (US$ 18.7 billion) into the economy.
*Translated by Gabriel Pomerancblum
