For the third consecutive year, government and private-sector economists are optimistically expecting the Brazilian economy to grow above 2%, leaving behind the near-stagnation since the country emerged from the 2014-2016 recession.
The so-called “it’s time to go” has been frustrated in the last two years by issues such as the delay in passing tax reforms, uncertainties about the Jair Bolsonaro administration, the Argentine crisis, and the slowdown in the world economy.
These are the same factors that threaten, in 2020, the strongest recovery in economic activity that has been seen since the beginning of the second half of 2019, partly anabolized by the release of FGTS resources that gave more gas to consumption.
The assessment, however, is that the risks are now smaller, and the incentives for economic recovery are better.
2020 begins with a critical stimulus compared to previous years: the reduction of the Selic rate to historically low levels (4.5% per year). Added to this is the acceleration of consumption seen in the last six months, which gives breath to trade and may lead to the replenishment of inventories in the industry.
Translated by Kiratiana Freelon