The International Monetary Fund (IMF) came to see a more favorable environment for the resumption of growth in Brazil. In the document released on Tuesday (19), the agency revised the projections for the economy in 2016 and in 2017.

After five consecutive falls in the projections for Brazil this year, the IMF made the first upward movement.Rather, the expectation was that register a recession of 3.8%; Now, this perspective went for a drop of 3.3%.

For next year, expectations also improved. Until then, the fund believed that there would be no growth, ie the growth rate of Gross Domestic Product (GDP) would be zero. Now, the forecast is for a 0.5%.

The evaluation of the IMF is that consumer confidence and business "seems to have hit bottom" and now beginning to recover. The contraction of GDP in the first quarter, notes the background of the report was also weaker than anticipated.

The IMF has also improved the forecast for GDP in Latin America and the Caribbean . Both for 2016 and for 2017, the estimated performance of the economy was increased by 0.1 percentage point (below, therefore, the revision made ​​to Brazil this year, of 0.5. 

For the region, the IMF predicts a decrease of  0.4% in 2016 and rise in GDP of 1.6% in the following year. Since the expansion of the global economy will be 3.1% this year and 3.4% in 2017.

 

Return to growth

For Brazil, the scenario is still decelerating, albeit to a lesser extent than expected earlier. One reason for this improvement in the assessment of the country, said the IMF, is the mood of consumers and entrepreneurs, who after falling in the first few months, reversed the downward trend and has operated the blue since June. 

"Consequently, the estimate for the recession in 2016 is a little less severe, with a return to growth in 2017," mused the international body.

In the global arena, Brazil is among a "small number of emerging markets" whose scenarios were reviewed for next year.

This positive perception is not restricted to the outside. In Brazil, the financial market begins to draw better numbers for 2016 and 2017.

Market expectations

The Focus Bulletin of the Central Bank weekly publication with expectations of economists, has brought forward prospects.

In the last published forecast, economists now expect a growth of 1.10% of GDP in 2017. The previous forecast was lower, 1.0%.

The country, however, can grow beyond these projections. The most optimistic analysts polled for the Focus project a growth of 2.84% for next year.

Source: Portal Brazil, IMF information and the Central Bank