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Brazil's financial market lowers 2022 inflation forecast

BRASILIA
2022-10-18 06:51

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BRASILIA, Oct. 17 (Xinhua) -- Brazil's financial market lowered its 2022 inflation forecast from 5.71 percent to 5.62 percent, marking the 16th time in a row economists have reduced expected inflation, the Central Bank of Brazil said on Monday.

According to the bank's weekly survey of the country's leading financial institutions, financial analysts also lowered their 2023 inflation forecast from 5 percent to 4.97 percent.

The bank's inflation target is 3.50 percent for 2022 and 3.25 percent for 2023, with a 1.5 percentage point margin of tolerance in both cases.

Analysts upgraded their economic growth forecasts, from 2.70 percent to 2.71 percent for 2022 and from 0.54 percent to 0.59 percent for 2023.

At the beginning of this year, the GDP growth forecast was 0.28 percent for 2022.

Regarding the benchmark interest rate, currently at 13.75 percent annually, analysts said they expect it to remain unchanged in 2022 and gradually decrease to 11.25 percent by the end of 2023.

Brazil's currency, currently trading at 5.29 reals to the U.S. dollar, is expected to trade at 5.20 reals to the dollar at the end of this year and the next.

The trade balance (exports and imports) is forecast to see 60 billion U.S. dollars in surplus both in 2022 and in 2023.

Foreign direct investment in Brazil is expected to reach 66 billion dollars in 2022 and 67.34 billion dollars in 2023.
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