In a recent report, the Central Bank announced that Brazil’s economic activity experienced a contraction of 0.06 % in September compared to the previous month, reaching its lowest point since January. The monthly index of economic activity, used to anticipate the trend of the Gross Domestic Product (GDP), indicated a growth of 1.1 % compared to the same month last year, according to seasonally adjusted data.
When analyzing the quarters, the largest Latin American economy recorded a decrease of 0.64 % between July and September compared to the previous three months.
Although the Central Bank increased its growth forecast for this year from 2 % to 2.9 % in September, attributing this adjustment to the solid performance of the agricultural sector, it warned that economic activity will weaken in the coming quarters. The projection now points to 1.8 % growth by 2024.
Although the federal government remains more optimistic, expecting economic growth above 3 % this year, especially after surprising growth in the second quarter, the long-term outlook suggests economic challenges on the horizon.
(Referential image source: Raphael Nogueira, Unsplash)