• Categories
  • Archives

Central Bank Lowers Brazil’s 2005 GDP Estimate from 3.4% to 2.6%

Brazil’s Central Bank (BC) lowered its estimate for this year’s growth in the Gross Domestic Product (GDP) from 3.4% to 2.6%. This forecast is part of the Quarterly Inflation Report, which was released Wednesday, December 28.

The latest report indicates the 1.2% drop in the GDP registered in the third quarter by the Brazilian Institute of Geography and Statistics (IBGE) as one of the main reasons for the lower estimate. The outlook for 2006 is for the GDP to grow 4%.

The report also estimates that the Broad Consumer Price Index (IPCA), which is the index of inflation used by the Brazilian government, will end the year at 5.7%, above the 4.5% target set by Brazil’s National Monetary Council (CMN). The BC is operating under the assumption that inflation will amount to 3.8% in 2006 and 3.6% in 2007.

In the judgment of the BC’s director of Economic Policy, Afonso Bevilaqua, the drop in the estimated GDP growth is "a thing of the past."

According to him, the prospect is one of recovery in the final quarter of 2005, due to the increase in the number of jobs and the real salary mass, as well as inventory equilibrium in the productive sector and credit expansion.

Bevilaqua observes that preliminary industrial and commercial data suggest a "more dynamic" economy from November on, which should ensure 3% growth in industry, 2.1% in services, and 1.5% in the agricultural sector in 2005.

The BC expects recovery in all segments of the economy next year: 5.3% growth in industry, 4.8% in agriculture, and 2.9% in services.

The performance of Brazil’s industry, he adds, should receive direct, positive impacts from domestic petroleum production and the favorable international economic situation, even with the slight decline in international oil prices.

The projection for the performance of the Brazilian agriculture is based on the estimated 2005/2006 agricultural harvest, in which grain production is expected to increase 12%.

Agência Brasil

Tags:

  • Show Comments (0)

Your email address will not be published. Required fields are marked *

comment *

  • name *

  • email *

  • website *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Ads

You May Also Like

Brazil Hopeful the Amazon Will Be Deemed Free of Hoof and Mouth Disease

According to the Brazilian Ministry of Agriculture, Livestock, and Supply, Brazil is about to ...

Brazil’s Landless Back to Highway Where They Were Massacred 10 Years Ago

On April 17, 1996, a confrontation occurred in Eldorado dos Carajás, in the southern ...

UNPUBLISHED Republic

Social crisis? What crisis? The press is the one that creates the crisis. By ...

Brazil’s Credit Rating Upgrade Felt More Like a Downgrade

Brazil government debt prices eased slightly after a rating agency upgraded Brazil’s credit but ...

IMF Lauds Brazil But Also Urges Budgetary Reform

IMF’s managing director Rodrigo de Rato, during a press conference in Singapore, Friday, September ...

Carioca Hill in Rio

52 Deaths Later Rio Finds Out It’s Too Lax in Allowing Building in Risk Areas

Sérgio Cabral, the Rio de Janeiro state’s governor, it turns out, signed into law ...

State Banks in Brazil Reap Record Profits

Two federally-controlled banks, the Caixa Econômica Federal (basically a savings and mortgage institution) and ...

Brazilian oil

Brazil to Change Rules to Get More Control of Oil Reserves

Brazilian president Luiz Inácio Lula da Silva will present a bill aimed at increasing ...

Energy in Brazil

Loans by Brazil’s Development Bank Grow 30% to Record US$ 37 Billion

Brazil's BNDES (National Bank for Economic and Social Development) posted record disbursements in the ...

‘Sons of the Jungle’ Vow Fight for Freedom in Brazil

The social movements that participated in the 4th Pan-Amazonian Social Forum (PASF), which took ...