SAO PAULO –  The outlook for Brazil’s economy deteriorated for a 17th week in a row, with Latin America’s largest economy now expected to shrink by 6.5% this year, a central bank survey of economists showed this week.

That is closer to recent revised estimates from a clutch of global banks including JP Morgan, UBS, HSBC and Goldman Sachs, for a contraction of 7% or more.

It is down from -6.25% the previous week and now almost two full percentage points below the government’s official forecast of -4.7%, which itself would still be the biggest annual decline in economic output since records began in 1900.

Brazil lost five million jobs in three months

The weekly ‘FOCUS’ survey on Monday also showed 2020 inflation expectations declining for a 13th consecutive week, albeit it slightly, to 1.53% from 1.55%, another historic low and well below the central bank’s official goal of 4.0%.

Among the survey’s other findings, economists significantly revised their current account deficit and foreign direct investment estimates for this year.

They now expected a current account deficit of US$ 20.5 billion, compared with a US$ 28.1 billion deficit last week and a US$ 35.9 billion shortfall a month ago. The average FDI inflow forecast was reduced to US$ 60 billion from US$ 64 billion a week ago, and over US$ 70 billion a month ago.–MercoPress

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