This was the second consecutive month of increase in the indicator. Over the course of the year, IBC-Br advanced 3.21% and, in the twelve months up to July, it rose 3.12%. The Central Bank’s Economic Activity Index (IBC-BR), considered the “preview” of the Gross Domestic Product (GDP), recorded an expansion of 0.44% in July, compared to the previous month, the institution reported this Tuesday. (19). The result was calculated after seasonal adjustment, a type of “compensation” to compare different periods. According to BC data, this was the second consecutive month of increase in the indicator, which rose 0.22% in June (revised data). In comparison with July last year, the Central Bank reported, the activity level indicator registered growth of 0.66%. In the first seven months of this year, the IBC-Br increased 3.21% and, in the twelve months up to April, it grew 3.12%. In this case, the index was calculated without seasonal adjustment. GDP is the sum of all goods and services produced in the country and serves to measure the evolution of the economy. The BC’s IBC-Br is an index created to try to anticipate the GDP result, but the results did not always show proximity to the official data released by the IBGE (see the difference below). Level of activity In 2022, the economy grew 2.9%, which represents a slowdown in relation to the 5% expansion recorded in the previous year. In the first three months of 2023, compared to the previous quarter, GDP increased 1.9%, exceeding financial market expectations. The result was driven mainly by agriculture. And in the second quarter, it grew 0.9% – surprising again. For this year, the financial market estimates an increase of 2.89% for GDP – with stability compared to last year’s result. For 2024, the expectation is for a lower growth of 1.50%. If GDP grows, it means that the economy is doing well and producing more. If GDP falls, it means the economy is shrinking. In other words, consumption and total investment is lower. However, a rise in GDP does not always equate to social well-being. GDP x IBC-Br The calculation of GDP, released by IBGE, and IBC-Br is slightly different – the BC indicator incorporates estimates for agriculture, industry and the services sector, in addition to taxes, but does not consider the demand side (incorporated in the IBGE GDP calculation). The IBC-Br is one of the tools used by the BC to define the country’s basic interest rate. With lower economic growth, for example, theoretically there would be less inflationary pressure. In August, the rate was reduced to 13.25% per year in the first cut in three years.