Financial market predicts inflation of 3.9%, dollar at R$5 and growth of 1.52% for the economy in 2024

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Numbers appear in the Focus bulletin released by the BC, with impressions collected at the end of 2023. Forecasts remained stable in relation to the previous edition of the bulletin. Financial market economists predict that Brazil will close the year 2024 with inflation of 3.9%, economic growth of 1.52% and with the dollar priced at R$5. The information is contained in the “Focus” report, released this Tuesday on Friday (2) by the Central Bank. The survey heard from more than 100 financial institutions, in the last week of 2023, about projections for the economy. Projections indicate stability in relation to the previous edition of Focus, released last week. The only variation was in the inflation forecast, which fell from 3.91% to 3.90%. The market once again estimated that the year 2023 will be consolidated with official inflation of 4.46% according to the Broad National Consumer Price Index (IPCA). The definitive data should be released in the coming weeks. If the forecast is confirmed, the forecast will be below the target ceiling (4.75%) for the first time in three years. In 2021, the IPCA totaled 10.06%. And, in 2022, inflation totaled 5.79%. For 2024, the inflation target is 3% and will be considered met if it oscillates between 1.5% and 4.5%. In other words: the 3.9% forecast made by experts is within the target, but closer to the ceiling than the floor. To define the basic interest rate and try to contain the rise in prices, the BC is already aiming, at this moment, at next year’s target, and also at 12 months until the beginning of 2025. The higher the inflation, the lower the purchasing power of people, especially those who receive lower salaries. This is because the prices of products increase, without wages keeping up with this growth. Special g1: what is inflation Understand: how inflation affects your pocket Gross Domestic Product The financial market estimates that Brazil’s Gross Domestic Product (GDP) will grow 1.52% in 2024. The government works with a higher forecast, of 2.3%. GDP is the sum of all goods and services produced in the country. The indicator serves to measure the evolution of the economy. Regarding the result of the Gross Domestic Product (GDP) for 2023, the financial market maintained its growth projection at 2.92%. This final result should be released by the government in the coming months. Interest rate Financial market economists maintained their estimates for the basic interest rate of the Brazilian economy for the end of 2024. Currently, the Selic rate is at 11.75% per year, after four consecutive reductions promoted by the Central Bank. For the end of 2024, the market projection for the economy’s basic interest rate fell from 9.25% to 9% per year. Other estimates See below other financial market estimates, according to the BC: Dollar: the projection for the exchange rate for the end of 2023 fell from R$4.93 to R$4.90. For the end of 2024, the estimate remained stable at R$5. Trade balance: for the balance of trade (result of total exports minus imports), the projection rose from R$79.8 billion to US$81, 4 billion surplus in 2023. For 2024, the expectation for a positive balance increased from US$69 billion to US$71 billion. Foreign investment: the report’s forecast for the entry of foreign direct investment into Brazil this year fell from US$60.3 billion to US$60 billion. For 2024, the inflow estimate fell from US$70 billion to US$65 billion. VIDEOS: economic news

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