Economic activity decreased in Brazil-report
2022.12.14 08:51
Economic activity decreased in Brazil-report
Budrigannews.com – A central bank index showed on Wednesday that Brazil’s economic activity decreased in October as aggressive interest rate increases to combat inflation hurt growth in the largest economy in Latin America.
The leading indicator of gross domestic product, the IBC-Br economic activity index, decreased by 0.05% seasonally adjusted from the previous month in October, in contrast to the 0.5% growth forecast by Reuters-interviewed economists.
The September performance was also downgraded by the central bank to stable from the initial 0.05 percent increase.
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Due to the effects of raising interest rates, economists and the government have been predicting a slowdown in growth in the second half.
Following an aggressive tightening of 1,175 basis points since March 2021, the central bank held interest rates at 13.75 percent earlier this month for the third time in a row.
Economic activity has been fueled by an improved labor market, fiscal stimulus on the eve of a presidential election, and a strong services sector recovery from the pandemic.
Be that as it may, higher getting costs started to burden credit and influence buyer spending.
According to the central bank, the IBC-Br index increased by 3.68 percent non-seasonally adjusted from October 2021 and was up 3.13 percent over the course of the year.
Private economists anticipate a 3.05% increase in Brazilian GDP this year, as stated in a weekly survey conducted by the central bank.
