IMF revises Brazil economic growth forecast upward
Photo made available by the International Monetary Fund (IMF) showing IMF Economic Counsellor Maurice Obstfeld (2-R), Deputy Director Gian Maria Milesi-Ferretti (L), Chief of the World Economic Studies Oya Celasun (2-L), and Communications Officer Olga Stankova (R), during the World Economic Outlook Press Conference held at the IMF Headquarters in Washington DC, USA on Oct. 10, 2017. EPA-EFE/IMF/Stephen Jaffe
Photo made available by the International Monetary Fund (IMF) showing IMF Economic Counsellor Maurice Obstfeld arriving at the World Economic Outlook Press Conference held at IMF Headquarters in Washington, DC, USA on Oct. 10, 2017. EPA-EFE/IMF/Stephen Jaffe
Washington, Oct 10 (efe-epa).- The International Monetary Fund (IMF) on Tuesday revised its economic growth forecast for Brazil upward to 0.70 percent for this year and 1.5 percent for 2018 due to stronger consumer spending.
"In Brazil, strong export performance and a diminished pace of contraction in domestic demand allowed the economy to return to positive growth in the first quarter of 2017, after eight quarters of decline," the IMF said in its World Economic Outlook report.
This signals that Brazil is returning to economic growth after a long recession that shrank the South American country's gross domestic product (GDP) by 3.6 percent last year.
Nevertheless, the IMF warned about "ongoing weakness in investment and an increase in political and policy uncertainty" due to political uncertainty in Brazil.
"After entering positive territory in the first half of 2017, growth in Brazil is expected to reach 0.70 percent for the year and 1.5 percent in 2018," the report said. "A gradual restoration of confidence - as key reforms to ensure fiscal sustainability are implemented over time - is projected to raise growth to 2 percent in the medium term."
The upward revisions for Brazil and Mexico - the other major Latin American economy - improved the regional outlook from a 1 percent estimated growth rate three months ago to 1.2 percent GDP growth this year.