Itaú BBA - Production normalized in June, but underlying growth lost momentum

Brazil Scenario Review

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Production normalized in June, but underlying growth lost momentum

August 10, 2018

Activity indicators suggest that underlying growth continues to lose steam despite normalization in industrial production in June

Please open the attached pdf to read the full report and forecasts.
 

Activity indicators suggest that underlying growth continues to lose steam despite normalization in industrial production in June. Our GDP growth forecasts are 1.3% for 2018 and 2.0% for 2019.

We maintained our estimates for the primary budget deficit at 2.1% of GDP for 2018 and 1.6% of GDP for 2019. Fiscal rebalancing continues to depend on reforms.

Our year-end forecasts for the exchange rate remain at BRL 3.90 per USD for 2018 and 2019.

Our estimates for consumer price index IPCA are unchanged, at 4.1% for 2018 and 4.2% for 2019.

The Monetary Policy Committee (Copom) maintained its benchmark Selic interest rate at 6.50% and did not signal changes in its stance. 

Please open the attached pdf to read the full report and forecasts.



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