Brazil should grow more than the world for the first time since 2010

Projections from the International Monetary Fund (IMF) released this Tuesday (10) in Marrakech (Morocco) indicate that this year, for the first time since 2010, the Brazilian economy is expected to grow more than the world average. For the next few years, however, the expectation is that the country will once again grow slower than the planet.

The projection for Brazil’s GDP growth in 2023, which was 2.1% in July, rose to 3.1%. For global GDP, the IMF expectation was maintained at 3%, below the 3.5% recorded in 2022.

The slowdown in the world economy occurs amid a scenario of monetary tightening and falling inflation. It is greater in the most advanced economies. “While these countries, in general, are at the peak of monetary tightening, some emerging markets have already begun easing,” highlights Bradesco bank in a report sent to clients this morning.

The Fund highlights that Brazil, alongside Chile, is easing the more restrictive monetary policy adopted last year, as a way of reducing global inflationary pressure that has its roots in the Covid-19 pandemic and was accentuated after the war in Ukraine. .

The Fund’s chief economist, Pierre-Olivier Gourinchas, highlights that the world economy is “limping” and not accelerating.

Prospects for 2023 are improving for Brazil

The IMF’s announcement for Brazil follows a series of upward revisions made by other international organizations.

Last week, the World Bank raised its projection for Brazilian GDP expansion to 2.6%. In mid-September, the Organization for Economic Co-operation and Development (OECD) had raised its forecast to 3.2%.

The IMF’s new expectations for Brazil are slightly above the median projections made by the local financial market, of 2.93%, according to the Central Bank’s latest Focus bulletin.

Brazilian growth will be lower from 2024

Projections for Brazil from 2024 to 2028, however, are not the most favorable, according to the IMF. The Fund predicts that the Brazilian economy will once again grow below the pace of the world economy. For 2024, for example, the forecast is that Brazil’s GDP will grow 1.5%, compared to 3% on the global average.

The new study does not go into more detail about the Brazilian economy. In the July release, however, the IMF highlighted a series of short and long-term economic challenges to be overcome, such as the persistent threat of inflation, high household debt and the lack of fiscal space to carry out priority spending and public investments. .