GDP preview drops 2% in May after rising 0.56% in April

The Economic Activity Index (IBC-Br), known as the “preview” of the Brazilian Gross Domestic Product (GDP), fell by 2% in May compared to April, according to data released this Monday morning (17) by the Central Bank.

The fall comes after a slight increase of 0.56% in April, and was calculated in a “seasonal adjustment”, which is a type of compensation to compare different periods of analysis. The month’s result is the biggest since March 2021, when the IBC-Br retreated 3.6%.

On the other hand, compared to May last year, the index grew by 2.15%, and has already accumulated a rise of 3.61% in the first five months of 2023. In 12 months, the result is 3. 43%.

The IBC-Br is one of the indices used by the Central Bank to try to anticipate the GDP result and is used to define the basic interest rate in the country. The Selic is currently at 13.75% and will be discussed on August 1st and 2nd during the next meeting of the Monetary Policy Committee (Copom).