The International Monetary Fund (IMF) raised its growth outlook for Brazil in 2020, however it helped to contain negative pressure from Mexico and Chile on the estimate for Latin America.
In the revision of its Global Economic Perspective report, released this Monday, the IMF started to see an increase in the Gross Domestic Product (GDP) of 2.2% from Brazil this year, 0.2 percentage point more than in the October report. The projection for world growth is 3.3% in 2020.
Mining Sector
According to the IMF, the upward revision of the estimate for this year is due to “improved sentiment after the approval of the pension reform and the reduction of supply problems in the mining sector”.
The fund's projection for this year is lower than estimated by the market and the government. According to this Monday's Focus Bulletin, which compiles market estimates for economic indicators, the Brazilian GDP should increase by 2.31% this year. The government foresees growth of 2,40%.
For 2019 there was also an improvement in the projection, of 0.3 points, to 1.2%. This estimate, however, is above the projected by the government, 1.12%, and by the market, of 1.17%. The IBGE releases the Gross Domestic Product (GDP) data for the fourth quarter and for the year 2019 on March 4.
Improved prospects for Brazil offset downward revisions to Mexico's growth in 2020 and 2021, among other reasons for continued weakness in investment.
So in addition to a strong reduction for Chile after social demonstrations. Now, the growth estimate for Latin America is 1.6% in 2020 and 2.3% in 2021, respectively cuts of 0.2 and 0.1 percentage points.
For emerging and developing markets, the IMF forecasts an expansion of 4.4% in 2020 and 4.6% in 2021, compared to an estimated 3.7% for 2019. The accounts for this year and the next, however, were reduced by 0. 2 percentage points each compared to the October forecast.
