The deceleration of GDP: Growth of only 2.2% in 2018

BRAZIL ECONOMICS - Report 16 Apr 2018 by Affonso Pastore, Cristina Pinotti, Marcelo Gazzano and Caio Carbone

At the start of the year (see the Weekly Bulletin “Economic Activity Recovering More Strongly”, of February 5th), a large number of indicators portended faster growth of investments. Among these were the decline in the stock of new residential units and the improved credit conditions for businesses. Also, the reduction of loan default and revitalization of the capital market were combined with signs of maturation of the microeconomic reforms in the credit market. Finally, due to the lower real interest rates and increase in real labor income, the deceleration of consumption in the last quarter of 2017 was interpreted as just a fluctuation around a favorable trend. However, the civil construction sector remains in the doldrums, and there are no signs yet of a significant rebound of fixed capital investments. And now, what appeared to be just a temporary deceleration of household consumption has turned out to be more persistent, and there are good reasons for this. Despite the low real interest rates, the driving force of the recovery – household consumption – has been losing steam, leading us to revise our projection of GDP growth for this year to only 2.2%.

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This report is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This report is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this report or its contents.