IMF improves Brazil GDP outlook from -3.8% to -3.3%

The International Monetary Fund (IMF) has narrowed its forecast for Brazil's economic downturn this year. The expected Gross Domestic Product (GDP) decline has gone from -3.8% in April to -3.3%. The IMF has also improved the forecast for next year from economic stagnation to 0.5% growth.

In its World Economic Outlook report published Tuesday (Jul. 19), the IMF estimates that the confidence of consumers and businesses seems to have bottomed out in Brazil, and the GDP decline was less severe than anticipated. As a result, the economic downturn in 2016 is now expected to be milder than previously thought, with the trend shifting to growth in 2017. The IMF noted, however, that the political uncertainties remain and can deteriorate the scenario.

The forecast for growth in emerging and developing economies was maintained at 4.1% for 2016 and 4.6% for 2017.

Translated by Mayra Borges