Brazil 2020 GDP Markets’ Forecast Seems Less Pessimistic

The markets in Brazil revised their forecasts for the GDP contraction in 2020 to 6.1% on July 10, compared to 6.5% a week earlier. This is the second upward revision in a row, after the forecasts for recession touched as low as 6.54% on June 26. The survey is conducted by the Brazilian Central Bank among 140 entities such as financial institutions, consultancies and brokerages.

The relatively improved market sentiment came after the release of upbeat domestic trade data on July 8. The volume of retail sales increased by 13.9% m/m in May, the highest monthly growth ever. Moreover, many businesses have reopened since June, which also may have a positive impact on the country’s economic activity.