Brasília – The Brazilian government revised its Gross Domestic Product (GDP) growth forecast slightly, from 0.81% to 0.85%, as per the Macro Fiscal bulletin made public this Tuesday (10). “Activity is projected to recover as of September this year in response to the initial impact of the interest rate cut, rising confidence and the clearing of immediate withdrawal of Severance Indemnity (FGTS) funds,” the bulletin reads.
The Extended National Consumer Price Index, which gauges inflation, is seen ending the year at 3.6%, down from a prior 3.8% forecast, as a result of “decompression” in food prices. “After an upward shock in these prices during Q1, Q2 saw a partial reversal, and the trend persisted through July and August.” The bulletin also mentions fuel and electricity price hikes and “relatively stable inflation in services.”
Translated by Gabriel Pomerancblum