Itaú BBA - Scenario gets increasingly challenging

Brazil Scenario Review

< Volver

Scenario gets increasingly challenging

junio 8, 2018

We lowered our GDP growth forecasts to 1.7% in 2018 , due to tighter financial conditions and the impact of the truckers’ stoppage

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

We lowered our GDP growth forecasts to 1.7% from 2.0% in 2018 and to 2.5% from 2.8% in 2019, due to tighter financial conditions and the impact of the truckers’ stoppage.

Our forecasts for the primary result worsened to -2.1% of GDP from -1.9% in 2018 and to -1.4% from -1.2% in 2019, incorporating government measures to end the truckers’ stoppage and lower economic growth.

We revised our year-end estimates for the exchange rate to 3.70 reais per U.S. dollar in 2018 and 2019 (from 3.50).

We lifted our inflation estimates slightly, to 3.8% this year and 4.1% in 2019. The truckers’ stoppage will likely cause just temporary pressure on inflation, but FX depreciation tends to exert moderate upward pressure on prices.

The central bank is set to keep the benchmark Selic interest rate unchanged at 6.5% until year-end. Upcoming decisions may be influenced by FX dynamics only if inflation expectations are materially impacted. 

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



< Volver