Financial market raises inflation estimate to 5.96% this year and sees higher GDP growth

[ad_1]

Investors’ inflation expectations exceed the target ceiling set by the CMN for this year, which is up to 4.75%. Economists in the financial market raised the inflation estimate for this year from 5.90% to 5.96% and also started projecting a greater expansion of the Gross Domestic Product (GDP). fair (13) by the Central Bank. More than 100 financial institutions were heard last week about the projections for the economy. Special g1: what is inflation Understand: how inflation affects your pocket For this year, the central inflation target was set at 3.25% by the National Monetary Council (CMN) and will be considered formally met if it oscillates between 1.75 % and 4.75%. If confirmed, this will be the third year in a row that the inflation target has been exceeded, that is, in which the IPCA is above the ceiling set by the target system. In 2022, inflation amounted to 5.79%. The higher the inflation, the lower the purchasing power of people, especially those earning lower wages. This is because the prices of products increase without wages accompanying this growth. For 2024, the financial market’s inflation projection was stable at 4.02% last week. The inflation target for next year, defined by the National Monetary Council (CMN), is 3% and will be considered achieved if it oscillates between 1.5% and 4.5%. GDP For Gross Domestic Product (GDP) growth in 2023, financial market expectations increased from 0.85% to 0.89% in the last week. It was the fourth rise followed by the indicator. GDP is the sum of all goods and services produced in the country. The indicator serves to measure the evolution of the economy. For 2024, the growth forecast remained stable at 1.5%. Last week, the Brazilian Institute of Geography and Statistics (IBGE) reported that GDP increased by 2.9% in 2022, against a rise of 5% in the previous year. Interest rate The financial market maintained expectations for the economy’s basic interest rate, the Selic, stable at 12.75% per year for the end of 2023. Currently, the Selic rate is already at 13.75% per year. The Copom has also been signaling that interest rates will remain high for a longer period. As a result, the financial market continues to estimate a drop in interest rates this year. By the end of 2024, the market’s projection for the economy’s basic interest rate was stable at 10% per year. Other estimates Below are other financial market estimates, according to BC: Dollar: the projection for the exchange rate for the end of 2023 remained at R$ 5.25. By the end of 2024, it was stable at R$5.30. Trade balance: for the trade balance balance (result of total exports minus imports), the projection remained at US$ 57 billion in surplus in 2023. For 2024, the expectation for the positive balance remained stable at US$ 55 billion. Foreign investment: the report forecast for the inflow of foreign direct investment in Brazil this year remained at US$ 80 billion inflow. For 2024, the inflow estimate also continued at US$ 80 billion. VIDEOS: economic news

[ad_2]

Source link