Brazil’s financial market upgraded its economic growth forecast for 2021 from 5.18 to 5.26 percent, while downgrading it slightly for 2022 from 2.10 to 2.09 percent, the Central Bank of Brazil said on Monday.
According to the bank’s weekly survey of the country’s main financial institutions, four weeks ago analysts expected gross domestic product (GDP) to expand by 4.85 percent this year.
This year’s estimated growth will easily reverse the downturn experienced by Latin America’s largest economy in 2020, when GDP shrank 4.1 percent.
Regarding inflation, analysts adjusted their forecast from 6.07 to 6.11 percent for 2021 and from 3.77 to 3.75 percent for 2022.
This year’s forecast vastly exceeds the government’s inflation target of 3.75 percent with a margin of tolerance of 1.5 percentage points, which caps inflation at 5.25 percent.
The trade balance is expected to leave Brazil with a surplus of 68.7 billion U.S. dollars in 2021 and 60 billion U.S. dollars in 2022.
Foreign direct investment in Brazil is projected to reach 55 billion U.S. dollars by the end of the year and 67.45 billion U.S. dollars next year.