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Economists Lower for Eighth Time in a Row Brazil GDP’s Forecast to Less than 1%

Brazilian financial organizations analysts revised down for the eighth week in a row the economic growth forecast for this year. The projection for the growth of the Brazilian Gross Domestic Product (GDP), the sum of all the goods and services produced in the country, decreased to 0.97%.

Last week, the forecast was 1.05%. As regards 2015, the estimate was maintained at 1.50%.

The projection for industrial output growth, this year, has also worsened, moving from a decline of 0.9% to 1.15%. As regards 2015, the estimate was revised from 1.8% to 1.7%.

The forecast for trade surplus (balance of exports minus imports) was revised from US$ 2.01 billion to US$ 2 billion for this year, and from US$ 9.4 billion to US$ 9.8 billion, in 2015.

The estimate for current transaction deficit (goods and services imports versus exports) was revised from US$ 80.75 billion to US$ 81.5 billion, in 2014, and from US$ 75 billion to US$ 74.1 billion, this year.

The Brazilian Central Bank’s Economic Activity Index (IBC-Br, seasonally adjusted) was down 0.18% in May from April. This was the second month-on-month decline this year. According to the revised figures, the decline in February was 0.09%.

May-on-May, activity was down 0.17%, based on unadjusted figures, since equal periods are being compared. Economic activity was up 1.93% in the 12-month period ended May and 0.58% year-to-date.

The IBC-Br is a means for assessing Brazilian economic activity. The index provides information on activity levels in the three sectors of the economy: industry, retail and services, and agriculture.

Outbound United States dollars have outnumbered inbound in Brazil. The foreign exchange flow showed a US$ 5.427 billion deficit in the first two weeks of July.

The negative result was both a result of trade operations (export- and import-related foreign exchange operations), at US$ 1.312 billion, and financial operations (investment in bonds, profit and dividend remittances to foreign countries and foreign direct investment, among other operations), which ran a US$ 4.114 billion deficit.

Year-to-date through July 11, the Forex flow showed a US$ 1.280 billion deficit. During the period, trade operations posted a US$ 1.578 billion surplus and financial operations had a US$ 2.858 billion deficit.

Santos

The port of Santos, in the state of São Paulo, moved 9.8 million tons in June, up 5.4% from June last year. It was the best result ever for the month. Export volume was up 8.1%, offsetting a 0.7% decline in imports June-on-June, as per the results released by state ports authority Companhia Docas do Estado de São Paulo (Codesp). Container shipping was up 15.4% to 325,000 TEUs (twenty foot-equivalent units).

The export products with the highest volumes shipped in June were soy bean, bran and oil (2.3 million tonnes), up 18.9% from June 2013; coffee bean (132,000 tonnes), up 47.2%; gasoline (146,800 tonnes), up 50.6%; and fuel oil (218,600 tonnes), up 85.1% from June 2013.

The highest import volumes were those of liquefied petroleum gas (84,700 tonnes), up 58.6%; and naphtha, a petroleum product, at 41,400 tons, up 632%.

H1 throughput was 52.9 million tonnes, down 1.6% from H1 2013. Container shipping, which has higher added value, was up 8% to 1.7 million TEUs.

H1 exports stood at 36.7 million tonnes (down 3.1% from H1 2013) and imports amounted to 16.1 million tonnes (up 1.9%). The 14.8% decline in throughput of sugar, the most shipped product at the port, had a significant impact on the decline in exports, as did maize (-52.5%) and pulp (-27.0%). H1 export highlights included soy bean, bran and oil (up 8.7%), coffee bean (19.8%) and gasoline (15.6%).

Imports of fertilizers, the main import product at the facility, were up 5.4% to 1.3 million tonnes, liquefied petroleum gas imports were up 58.6% to 462,400 tonnes, wheat imports were up 19.8% to 772,100 tonnes and naphtha imports were up 111.9% to 146,600 tonnes.

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