GDP performance was good in the combined 2020 and 2021, says Campos Neto

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The president of the Central Bank, Roberto Campos Neto, said on Monday that the performance of the Gross Domestic Product (PIB) do Brasil it was good in 2020 and 2021 combined, but acknowledged that there are downward revisions in 2022.

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“There are lower forecasts for 2022. Brazil has lower structural growth than other countries. Therefore, we need to continue with the reforms, to increase this structural growth, said Campos Neto, attending an event at the São Paulo Trade Association (ACSP).

The president of the Central Bank also highlighted negative surprises about growth in Asia and stated that the global recovery is already slowing down.

Regarding Asia, Campos Neto highlighted the “private battles” in China, such as civil construction, with the problem with Evergrande and empty properties.

The BC president also mentioned the regulation of technology companies and their dismemberment, the attempt to adapt to carbon targets, which is already causing energy rationing, and other conflicts, such as with Brazilian beef. “There is already an initial reaction in stock and real estate prices, with the Chinese government trying to smooth the fall.”

In addition, Campos Neto highlighted that some countries are extending the aid created in the covid-19 pandemic a little, but to a lesser extent.

Inflation of services

Campos Neto assessed that service inflation in the country is “relatively well behaved”, and that it has been rising because the economy is reopening amid the cooling of the Covid-19 pandemic.

When participating in a meeting of the São Paulo Trade Association broadcast online, he stressed that the BC continues to look closely at the number of services.

Campos Neto said that the economy is “almost completely reopened”, pointing out that the indexes analyzed by the BC show a “very large” degree of reopening.

Exchange

Campos Neto also said that the depreciation of the real this year is on average and even “a little better” compared to other countries.

At a meeting of the São Paulo Trade Association, he stated that the first wave of inflationary surprises occurred in 2020, being linked to food and the behavior of the exchange rate, with the currency having depreciated “a lot” last year.

According to Campos Neto, the second inflation shock, in 2021, was basically due to monitored prices.