Brazilian Economy outlook
Brazilian Economy Picks Up Speed in 2012
The monetary easing measures carried out to accelerate growth since the second half of 2011 have already taken effect by the beginning of 2012. After rising 1.3% and 0.5% in November and December 2011, on a seasonally-adjusted basis, retail trade grew 2.6% in January 2012. The industrial production also increased 1.3% in February 2012 in comparison to January. The expansion was largely due to (i) the strength of formal job market, (ii) the easing cycle of the benchmark interest rate from July 2011 on, and (iii) credit growth, which reached 48.9% of GDP in February 2012.
The robust growth of domestic demand, coupled with measures aimed at providing incentives to increase productivity and competitiveness of the industrial sector, is expected to lead to a manufacturing industry recovery throughout 2012 and shall foster activity even more in the service sector. Therefore, economic activity is expected to pick up speed over the year, so that, by the end of 2012, economic growth should have reached its peak. The trajectory brings more robust GDP growth in 2012.
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Brazilian Economy Outlook
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