September 24, 20 - 10:57 am - LABS

Brazil’s Central Bank updates projection for GDP drop from 6.4% to 5%

Brazil’s Central Bank revised its estimated decrease in GDP for 2020 from a previous 6.4%, forecasted in June, to 5%. The projection was announced this Thursday, in the Inflation Report, released quarterly by the authority.

In the report, the Central Bank recalls that GDP fell 9.7% in the second quarter of 2020, “reflecting the magnitude of the retraction in activity in March and, mainly, in April”. According to the entity, there are “more favorable perspectives for the third quarter, in line with the available domestic indicators, the most recent information on the pandemic and the expected evolution of the international economy”.

For 2021, “still with uncertainty above the usual”, the growth projection is 3.9%. “It should be noted that this perspective depends on the continuity of the process of reforms and necessary adjustments in the Brazilian economy, an essential condition to allow the sustainable recovery of the economy”, it further stated.