• Unemployment in Brazil saw some improvement in 2019 compared to the 2018 level of 12.3%. There is a high expectation for the new government to deliver reforms. The contraction in industrial output was compensated for by the growth in services and primary sectors, with the prospects for agricultural output remaining favourable.
  • Inflation in 2018 and 2019 was in line with the central bank target of 3-6%. Consumer expenditure is expected to remain robust, primarily owing to the low-interest rate of 6.5%.
  • The country is also seeing a shift from its primary consumption-led growth model, which may have run its course. Government officials are making significant cuts to permanent expenditures to comply with the present government’s fiscal targets. Overall, it is expected to add 0.3% to GDP growth.