Macro Forum: The Street View


Brazil Image

Economic growth in Brazil is expected to reach 2.3% in 2020, compared to subdued growth of 0.9% in 2019. Bolsanaro, entering his second year in office, continues to prioritise large-scale reform and, with the pension reform bill approved by the lower house, focus has turned to the government looking for large scale foreign investment in infrastructure, mining, energy and transport sectors. The world waits to see how the funding market with accommodate these plans. In November 2019, Congress approved the final version of the pension reform plan proposed by the Bolsonaro’s administration, The reform is expected to generate savings of approximately BRL 800 billion (US$ 190 billion) over the next ten years. The lower interest rate environment has also contributed to significant reduction of the sovereign cost of debt, and may contribute to further BRL $100 billion of public expenditure savings for the upcoming year

Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020
GDP* 1.1% 1.2% 1.7% -0.3%
Inflation* 3.37% 2.89% 4.31% 3.3%

* Year on Year



Real GDP growth

Source: International Monetary Fund

Brazil FX vs FV

Source: Bloomberg Spot Price and Actis methodology for Fundamental Value


Source: International Monetary Fund