Brazil economy

As Brazil’s polling day draws closer, another data point emerged on Friday for the voters’ consideration: consumer price inflation is back above the upper limit of the government’s target range and shows no sign of falling back soon.

The IBGE, Brazil’s statistics office, said CPI in the month to mid-September was 0.39 per cent, bringing the accumulated rate over the past 12 months to 6.62 per cent. That was above the consensus forecast of 0.35 per cent for the month, according to Bloomberg. Continue reading »

Another week and yet another cut in the consensus on Brazilian GDP growth this year. The central bank’s weekly survey of 100 market economists has notched up 16 consecutive weeks of downward revisions to bring the consensus on GDP growth to just 0.33 per cent this year. The outlook for 2015 also fell, to 1.04 per cent.

At least the central bank’s survey is not alone. The OECD, also on Monday, in its latest Economic Outlook cut its forecast of Brazilian growth to just 0.3 per cent this year and 1.4 per cent in 2015. That’s down from an expected 1.8 per cent in 2014 and 2.2 per cent in 2015 at the OECD’s last Economic Outlook in May. Continue reading »

Just as President Dilma Rousseff thought she had put a scandal affecting state-owned oil company Petrobras behind her, it has come roaring back, nastier than ever.

Paulo Roberto Costa, a former Petrobras executive accused of accepting kickbacks in return for contracts, has reportedly made a plea bargain with investigators that has got Brasília sweating. Continue reading »

Growing in Brazil has long been in the sights of Carlos Slim’s América Móvil. The company has almost as many subscribers there as in Mexico, where it is under regulatory pressure.

So teaming up with an existing carrier to buy the country’s No. 2 cellphone carrier might be a smart move.

According to Bloomberg, América Móvil is talking to Brazil’s Oi about teaming up to make a joint bid for the Brazilian operations of mobile operator TIM. Continue reading »

With every passing week, the gloom over Brazil’s economy gets a little deeper. The central bank’s latest weekly survey of market economists shows that the consensus for GDP growth this year has fallen for its 15th consecutive week and is now just 0.48 per cent.

Investors dismayed by the interventionist, sectoral industrial policies pursued by President Dilma Rousseff – up for re-election on October 5 – may be even more dismayed to see their latest predicted results: industrial production is expected to fall by 1.98 per cent this year, from a fall of 1.53 per cent four weeks ago. Continue reading »

When Brazil’s presidential election circus arrived in Rio Grande do Sul this week, it was hard not to see the difference between the styles of the two leading candidates.

Marina Silva, the upstart environmentalist who has suddenly taken the lead in the polls, staged what was almost a stealth visit. On Thursday, she arrived at Expointer 2014, a large agricultural fair on the edge of the state capital Porto Alegre, in a van ,and held tough closed-door meetings with her erstwhile adversaries in the rural sector. Continue reading »

By Jim O’Neill, Bruegel

Is it all over for the rise of the BRIC grouping (Brazil, Russia, India and China)?

On one level, this seems like a rather odd time to be asking such a question, especially when the political leaders of the BRICS countries (the four named above plus South Africa) have recently agreed to set up a joint development bank to be headquartered in Shanghai. So, the BRICS name is certainly here to stay, and in terms of global governance, their influence is likely to rise as a group because of the bank. Continue reading »

Another week and yet another contraction in the consensus for GDP growth in Brazil this year. The central bank’s latest weekly survey of market economists has notched up its 14th consecutive week of falling forecasts and now predicts growth of just 0.52 per cent this year – which may even sound optimistic to some after last week’s figures showing the economy was in recession during the first half. Continue reading »

The weekly survey of market economists by Brazil’s central bank is becoming the economic equivalent of a limbo dance: each time around, just that little bit lower. This week’s edition has GDP growth in 2014 coming it at just 0.81 per cent, making 11 consecutive weeks of contraction. The outlook for 2015, which had been unchanged for five weeks at 1.5 per cent, has also come down, to 1.2 per cent.

Voters, though, don’t seem to be bothered. Continue reading »

How much lower can it go? The consensus on Brazil’s economic growth this year has been revised downwards for nine successive weeks, according to the central bank’s latest survey of market economists, and now stands at a meagre 0.9 per cent.

The consensus on growth next year is not much better, at 1.5 per cent. As our chart shows, estimates of growth this year (the black line) and next have been in decline for the past 12 months. (Longer, in fact. When the bank first asked economists about growth in 2014, they expected it to come in at 3.8 per cent.) Continue reading »

Brazil’s humiliating 7-1 loss to Germany in the World Cup semi-finals was bad enough but now it looks like the country’s economy may also be heading for a similarly crushing defeat. While annual inflation is creeping up towards 7 per cent, most economists now forecast GDP growth this year of little more than 1 per cent.

Faced with this gloomy scenario, Brazil’s central bank will have little choice but to do precisely nothing at its interest rate meeting this week. Continue reading »

As Joe Leahy reported at the weekend, the back injury suffered on Friday by Neymar, Brazil’s star striker, is unlikely to hurt President Dilma Rousseff in her bid for re-election in October. She may even benefit, as the nation bonds together in grief or – there is, after all, still a chance – in celebration.

But Rousseff should forget Neymar. Come October, Brazilians will likely be much more worried about the economy. And here, Rousseff has plenty to fear. Continue reading »

Grupo Lala, which controls about half of Mexico’s dairy market, has been running a World Cup promotion to give consumers the chance to win tickets to Brazil. Now, it seems, it could have been eyeing Latin America’s biggest market itself.

According to Bloomberg, Lala is keen to buy BRF’s (Brazil Food) dairy business in Brazil, which the company has reportedly been hawking to potential buyers. Continue reading »

The mood in Brazil has no doubt brightened after Monday night’s convincing win over Cameroon in the World Cup. On that showing, Brazilians will have plenty to cheer about over the next few weeks. At some point, however, they face the morning after.

A survey to be published tomorrow by LatAm Confidential, a research service at the FT, shows consumer confidence sinking to its lowest level since the survey began in February 2012. It follows a central bank survey of market economists on Monday in which the consensus on growth fell to a new low. After so much flair on the pitch, many Brazilians will be left wondering why the spark has gone out of their economy. Continue reading »

Will the consensus on Brazil’s economy never bottom out? For the third week in a row, market economists have cut their outlook for GDP growth this year, to 1.24 per cent, according to a central bank survey. That’s down from 1.44 per cent last week and 1.62 per cent four weeks ago.

The consensus for next year is down, too, to 1.73 per cent, from 1.8 per cent last week and 2 per cent four weeks ago. Continue reading »