MercoPress. South Atlantic News Agency

Brazilian economy forecasted to grow 3,45% this year with 3,75% inflation

The benchmark interest rate, Selic, is forecasted to remain 3.25% by the end of 2021 and at 4.75% by the end of 2022

Brazilian financial and market analysts upgraded their economic growth forecast for 2021, from 3.41% to 3.45%, and maintained the projection at 2.5% for 2022, the Central Bank of Brazil announced Monday.

According to the bank's weekly survey of the country's top financial institutions, the analysts also increased estimated inflation for 2021 from 3.34% to 3.43%, but kept it at 3.5% for next year.

The inflation forecast falls within the government's target goal of 3.75% in 2021 and 3.5% in 2022, with a 1.5-percentage point margin of tolerance.

Regarding the benchmark interest rate Selic, the forecast remained at 3.25% by the end of 2021 and at 4.75% by the end of 2022.

Analysts kept their projection for the Brazilian currency, which currently stands at 5.3 reais against 1 U.S. dollar, at 5 reais at the end of 2021 and 4.9 reais in December 2022.

Likewise the trade balance is expected to deliver a surplus of US$ 55 billion in 2021 and 50 billion U.S. dollars in 2022. Finally foreign direct investment is expected to reach 60 billion U.S. dollars in 2021 and 70 billion U.S. dollars the next year.