Brazil’s Financial Market Forecasts 3.4% Economic Growth in 2021
RIO DE JANEIRO, BRAZIL – Brazilian financial analysts slightly upgraded their 2021 growth forecast, from a 3.4 percent to 3.41 percent expansion in gross domestic product (GDP), after modifying the estimated contraction for 2020 from 4.36 to 4.37 percent, the Central Bank of Brazil said Monday, January 11th.
According to the bank’s weekly survey of the country’s top financial institutions, the analysts also raised estimated inflation for 2021 from 3.32 percent to 3.34 percent.
The forecast inflation falls within the government’s target goal of 3.75 percent in 2021, with a 1.5-percent margin of tolerance.
Regarding the benchmark interest rate, currently at 2 percent annually, the analysts adjusted their forecast from 3 percent to 3.25 percent by the end of 2021.
Analysts also revised the projection for the Brazilian currency, which is currently 5.49 reals against 1 U.S. dollar, to 5 reals at the end of 2021.
Moreover, the trade balance between imports and exports is expected to deliver a surplus of 55 billion U.S. dollars in 2021, while the forecast for foreign direct investment is expected to reach 60 billion dollars.
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