The Economic Policy Secretariat (SPE) of the Ministry of Economy raised the projection for economic growth this year, while the estimate for inflation declined. The projections are in the MacroFiscal Bulletin released today (15).
The estimate for the increase in Gross Domestic Product (GDP, sum of goods and services produced in the country) was from 2% to 2.7%, in relation to the bulletin released in July, reflecting the increase in employment, the performance of the sector of services and the increase in the investment rate.
“The upward revision for economic activity in 2022 is mainly due to the second quarter GDP result – growth of 1.2% at the margin – higher than estimated and the positive trend of the indicators already released for the third quarter of 2022”, he informed. the SPE.
In the first half, the indicator accumulates a high of 2.5%. In 2021, Brazil‘s GDP grew by 4.6%, totaling BRL 8.7 trillion.
According to the Ministry of Economy, there was an expansion in the job market, with the unemployment rate falling to 9.1% in the quarter ended in July and the number of employed people reaching almost 100 million, a record in the historical series, which began in 2012. Data are from the Brazilian Institute of Geography and Statistics (IBGE).
In terms of investments, Gross Fixed Capital Formation (GFCF) grew by 4.8% in relation to the previous quarter in the last release of national accounts. And, according to IBGE data, the service sector indicators had an annualized expansion of almost 4.5% in the last three quarters.
The Ministry of Economy expects continued growth in activity throughout this second half of the year. “The first releases for the month of July suggest that industry, services and the job market continue to grow. The confidence series confirm the positive expectations for the third quarter of 2022, with widespread expansion in the various sectors”, says the SPE.
However, estimates assume some slowdown in the economy over this period due to external risks, such as the slowdown in global growth and the impacts of the war in Ukraine. In this adverse context, there was a review of the growth rates of developed and emerging countries that help to compose the basic scenario for the projections.
“The basic scenario for projecting activity in this parameter grid assumes, as an important assumption, moderate growth for 2023 in developed and emerging economies of 1.1% and 4.4%, respectively. This indicates that, according to the market consensus, there should be a deceleration of economic activity in developed countries, but an acceleration of growth for emerging countries, when compared to the latest estimates for 2022. It should be noted that the baseline scenario does not consider a recession global, with negative effects on the terms of trade and local financial conditions,” says the bulletin.
For the coming years, from 2023 to 2026, the estimate for Brazilian GDP growth remained at 2.5%.
The inflation projection by the Broad National Consumer Price Index (IPCA) for 2022 dropped from 7.2% to 6.3%. But it is still above the inflation target for the year, defined by the National Monetary Council at 3.5%, with a tolerance interval of 1.5 percentage points up or down. That is, the lower bound is 2% and the upper bound is 5%.
In the year, the IPCA already accumulates a high of 4.39% and, in 12 months, the total index is 8.73%.
The National Consumer Price Index (INPC), used to establish the value of the minimum wage, should end this year with a variation of 6.54%, according to the SPE forecast, a drop of 0.87 percentage point compared to the previous bulletin. . The projection for the General Price Index – Internal Availability (IGP-DI), which also includes the wholesale sector and the cost of civil construction, in addition to the final consumer, is 9.44%, below the variation seen in the previous grid, of 11.51%, and lower than the rate recorded in 2021, of 17.74%.
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Translated to english by RJ983
From Brazil, by EBC News