Economists Fear that Bolsonaro Speeches Will Inflate Recession

For analysts, coup talk adds uncertainty to an already challenging recovery scenario

São Paulo

President Jair Bolsonaro's threats of a coup on Sept. 7 are amplifying fears that the economic recovery may be weaker than previously thought and that the country could fall into a new recession, according to analysts.

Bolsonaro's retreat, in a letter in which he says he had no intention of attacking other branches of the government, brought momentary relief to the market. Among economists, skepticism about the chief executive's promise is strong.

For specialists, the anticipation of the 2022 electoral scenario, embedded in the president's movements, limits progress in the discussion of robust reforms.

The expectation of a slowdown in growth, already expected due to inflation, is aggravated by political tension.

The Central Bank revised its projections for the GDP (Gross Domestic Product) for the next year to 1.93%. According to economist José Roberto Mendonça de Barros, analysts agree that growth will be below 2%, and may even be less than 1%.

Translated by Kiratiana Freelon

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