MercoPress. South Atlantic News Agency
Brazilian government cuts 2012 growth forecast from 4.5% to 3%
Planning Minister Miriam Belchior The Brazilian government said Friday it was cutting its economic growth forecast for this year from 4.5% to 3% due to the impact of the global slowdown. However the figure is still higher than the 2.5% predicted by the Central Bank.
“On the international stage, the most recent decisions made by European leaders dispelled the risk of a banking crisis in the short term, but the absence of growth and the reduction in trade still prevail in the advanced economies,” the planning ministry said in a report.
“Brazil is prepared and in a better position compared with the major countries... But even our country was affected by this deterioration of the international situation.”
In the first quarter of the year, the GDP of Latin America's largest power grew only 0.2% compared with the previous quarter and only 0.8% when compared with the same period of 2011. Last year Brazil’s economy, now the sixth largest in the world, grew only 2.7% after a strong 7.5% in 2010.
Over the past few months, the government has taken a series of steps to stimulate the economy and boost growth, including lowering taxes and bringing the base interest rate to a historic low of 8% to spur domestic consumption.
“The recovery of growth occurs gradually, given that some various stimulus measures adopted by the authorities have yet to fully affect economic activity,” the report said.
However, the government predicted that growth will accelerate in the second half of 2012, boosted by its stimulus packages.
The IMF earlier called on Brazil to increase productivity and rebalance domestic demand “from consumption to foster saving and provide space for investment.”
Top Comments
Disclaimer & comment rules-
-
-
Read all commentsSo how come the Planning Minister is announcing this instead of the prat of a Finance Minister?
Jul 21st, 2012 - 11:02 am 0Has Rousseff finally woken up to the fact he is useless?
And they have got to get to 3% yet: I am still betting on the Central Bank being nearer to the number than the 'government', 2.25% perhaps.
Let´s see, Brazil´s economy expanded at a rate of 0.3% in Q1 and 0.2% in Q2, but the Planning Minister is saying that the country will achieve 3% this year. That pretty much means that Brazil will have to grow at rates of 5.7% for the remaining two quarters of the year.
Jul 21st, 2012 - 01:08 pm 0The IMF predicts 2.5% growth, Credit Suisse and other banks are projecting 1.5% only, which Mantega says it is “a joke”.
But the IMF is still being optimistic, because Brazil will have to grow at rates of 4.5% in the next quarters in order to achieve a mere 2.5%.
I think Credit Suisse´s projection is the most realistic, because it assumes that Brazil will manage to expand its economy at 2.8% in the final quarters, to make the 1.5% annual growth number.
2
Jul 21st, 2012 - 06:20 pm 0You wrote are others' hypothesiss
Where are your own opinion ?
Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!