BRASÍLIA: Brazil’s economy would stall in 2015 with inflation coming in nearly 1 percent above the high end of the government’s range, the Central Bank said.
Analysts revised their 2015 gross domestic product (GDP) estimates downward from 0.03 percent to zero in the latest survey released by the Central Bank.
The GDP estimate was included in the Boletin Focus, a weekly Central Bank survey of analysts from about 100 private financial institutions on the state of the national economy.
The downward revision confirmed the pessimism among analysts, who back in early January expected Brazil’s economy to grow 0.50 percent this year.
Analysts have revised their GDP estimates downward for six straight weeks.
If the estimates prove accurate, Latin America’s largest economy will finish 2015 with its worst performance since 2009, when the GDP contracted 0.33 percent.
The government expects the economy to grow 0.80 percent this year.
Brazil’s economy grew by less than 0.15 percent in 2014, according to government estimates, slowing down sharply.
The South American country’s economy grew 2.3 percent in 2013 after expanding at an anemic 1 percent rate in 2012.
Analysts surveyed for the Boletin Focus expect Brazil to end 2015 with an inflation rate of 7.15 percent, revising their estimates upward from the 7.01 percent projection released last week.
The inflation estimates have now risen for a sixth consecutive week.
The government has an inflation target of 4.5 percent for the year, with a 2 percent band.
Brazil finished 2014 with an inflation rate of 6.41 percent, well above the 5.91 percent rate registered in the prior year but below the top end of the government’s range.
The Central Bank has responded to rising prices by gradually hiking interest rates.
