MercoPress. South Atlantic News Agency

Guedes dismisses IMF estimates for Brazil's growth this year and 2022

“Estimates regarding Brazil have been consistently wrong”, said Guedes keeping to his projected forecast of a 5,5% GDP growth this year

Brazil's orthodox Economy minister Paulo Guedes anticipated that the multilateral institutions such as the IMF, once again are going to err their forecasts on the Brazilian economy growth. The comment follows on the IMF release stating that the Brazilian economy is estimated to grow 5,2% this year and 1,5% in 2022, below the government's forecasts.

“Estimates regarding Brazil have been consistently wrong“, said Guedes keeping to his projected forecast of a 5,5% GDP growth this year. Officially the Ministry of Economy estimates are 5,3% in 2021 and 2,2% in 2022.

However Guedes admitted that inflation is on the rise, and blamed half the index to ”the increase in food and energy prices globally“. ”There's nothing new on that about Brazil“ added.

In the United States for the annual summits of the IMF and the World Bank, minister Guedes again defended the improved Brazilian fiscal situation, anticipating that the primary deficit will soon fall close to zero in 2022.

When asked about the loss of purchasing power of the Brazilian currency Real allegedly because of fiscal shortcomings, Guedes replied that the situation has to be blamed on political turmoil.

”The fundamentals are in place, but now we have all this political noise, that is the real reason“, said Guedes who nevertheless admitted concern about the political unrest and their influence on markets in 2022, a presidential election year.

Furthermore, while ”the fiscal front can be considered under control,“ Guedes argued that the monetary fundamental is very much present with the Central bank raising the basic Selic rate to help combat inflation.

”The people who lost the elections three years ago never accepted the results, and continue to beat their drums. We understand this as a very vibrant democracy, after all it was the first time that the left was defeated by the liberals and conservatives”, emphasized Guedes.

Lula da Silva twice Brazilian president, but who still has some corruption trials pending, and is considered a formidable candidate for the 2022 presidential election, according to opinion polls, and a severe critic of Bolsonaro, recently announced that he will wait until the end of the year to make any formal announcement, be it to accept the candidacy or give his blessing to someone younger.