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Montevideo, October 25th 2020 - 08:56 UTC

 

 

Brazil’s growth refuses to take off, despite all of government incentives

Friday, July 5th 2013 - 23:35 UTC
Full article 12 comments
The wrath of the streets and economic data has fallen upon President Rousseff The wrath of the streets and economic data has fallen upon President Rousseff

Brazil’s industrial output fell 2% in May after jumping a revised 1.9% in April, the national statistics agency announced this week in Rio de Janeiro. The fall was greater than forecasted but still was 1.4% above a year ago. However as the government or President Dilma Rousseff struggles to fight inflation, the latest data complicates the strategy to prop growth.

President Rousseff administration has slashed payroll taxes for dozens of industries and cut electricity rates in a bid to boost production. At the same time, the central bank started raising rates in April to tame inflation above the upper range of the target. Amid slower-than-forecast growth, industry confidence in June fell to its third-lowest level since 2009.

Industry contracted 0.3% in the first quarter from the previous three months. That drag on Brazil’s economy caused total GDP to grow 0.55%. Economists surveyed by the central bank reduced their 2013 growth forecast for the seventh straight week to 2.4%.

Brazil’s central bank accelerated the pace of interest rate increases in May in a bid to slow inflation that is hurting economic growth. The bank, which has increased its Selic rate by 75 basis points since April, will hold its next monetary policy meeting on July 9-10.

Consumer price inflation accelerated to 6.67% in the year through mid-June, exceeding the top range of the central bank’s target of 4.5% plus or minus two percentage points.
 

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  • yankeeboy

    I seem to remember last year when I posted Brazil wasn't going to have much if any growth this year some of the Rg idiots ask if I was smarter than the economists.

    Apparently the answer is yes.

    Jul 05th, 2013 - 11:46 pm 0
  • Escoses Doido

    LOL (they should know that what 'economists' do is by no means an exact science)

    Jul 06th, 2013 - 09:59 am 0
  • Britworker

    Well world cups, Olympic games disproportionate armed forces budgets and oil exploration are very expensive, but then so are good public services and infrastructure.

    The number one rule of good housekeeping is that you don't go shopping when you are hungry, you end up buying things that you don't need and can't afford.

    Oh Maggie we miss you.

    Jul 06th, 2013 - 12:59 pm 0
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