Brazilian government raises inflation forecast for 2021 – Prensa Latina

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According to the Macrofiscal Bulletin of the Economic Policy Secretariat, the inflation forecast for 2022 was 3.75 per cent, higher than the official target of 3.5 per cent.

Such figures will serve as a seat for arranging calculations for the 2022 draft budget sent by the government to Parliament in August.

It is expected that after the debate on that matter, it will be approved before the end of the year.

Due to the increase in prices, the increased margin in the set of estimated expenses and income for the next year will have to be reduced due to the readjustment of the minimum wage and the index of state expenses.

The administration had more room in the 2022 budget to increase the amount of social assistance from the Bolsa Familia resource transfer program, convert to Auxilio Brasil, and increase the value of subsidies and the number of beneficiaries.

With regard to Gross Domestic Product (GDP), the bulletin kept the growth expected at 5.3 per cent by the end of 2021.

Similarly, he praised the idea against a contraction of Brazil’s GDP, an indicator that shrank by 4.1 percent in 2020.

This improvement was seen in the services sector, which in the previous calendar was most affected by the fall in demand due to the Covid-19 pandemic.

The government’s outlook for 2022 on GDP growth has gone up from 2.51 to 2.5 per cent.



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